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CS Executive · Company Law and Practice · Meetings of Board and its Committees

Kaveri Textiles Ltd's Board wishes to delegate certain powers to its Managing Director by a resolution passed at a meeting. Which one of the following powers can be delegated under the proviso to section 179(3)?

Borrowing monies can be delegated. The proviso to section 179(3) allows the Board, by a resolution at a meeting, to delegate only the powers in clauses (d) to (f), namely borrowing, investing and giving loans, guarantees or security, to a committee, the managing director, manager or principal officer.

  1. ATo make calls on shareholders for unpaid money on shares
  2. BTo approve the financial statement and the Board's report
  3. CTo borrow moniesCorrect
  4. DTo approve a merger or reconstruction

Explanation

The proviso to section 179(3) permits delegation, by a resolution passed at a meeting, only of the powers in clauses (d) to (f): borrowing, investing funds, and granting loans or guarantees or providing security. Calls on shares, approval of financial statements and approval of mergers are other clauses and cannot be delegated.

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