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CS Professional · Strategic Management and Corporate Finance · Raising of Funds from Debt and Procedural Aspects

Under the Companies Act, 2013, which of the following powers must the Board of Directors exercise on behalf of the company only by means of resolutions passed at meetings of the Board?

The power to borrow monies must be exercised by the Board through resolutions passed at Board meetings. Section 179(3) lists it with powers such as issuing securities, investing funds and granting loans. Appointing auditors, altering objects and declaring final dividends belong to members.

  1. ATo borrow moniesCorrect
  2. BTo appoint the statutory auditor of the company
  3. CTo alter the objects clause of the memorandum
  4. DTo declare the final dividend recommended to shareholders

Explanation

Section 179(3) lists the powers to be exercised by Board resolutions at meetings, and clause (d) is the power to borrow monies. The other options are not in that list: the auditor appointment, alteration of objects and final dividend are matters for members in general meeting.

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