Section 181 of the Companies Act, 2013 explicitly provides the provisions for Contribution to Bona fide and Charitable Funds etc.
Shareholder’s approval in general meeting in case any contribution amount exceeds 5% of company’s average net profits of preceding 3 financial years.
Following Procedure is to be Followed
Convene a Meeting of Board of Directors [As per section 173 & SS-1]
Issue Notice of Board Meeting to all the Directors of Company at their addresses registered with the Company, at least 7 days before the date of Board Meeting. A shorter notice can be issued in case of urgent business.
Attach Agenda, Notes to Agenda and Draft Resolution with the Notice.
Hold a meeting of Board of Directors of the Company and pass the necessary Board Resolution
Directors approval for contribution to bona fide and charitable trusts etc. subject to shareholders approval if amount exceeds 5% of company’s average net profits of preceding 3 financial years
To fix day, date, time and venue for holding General Meeting of the Company and approve the draft notice of GM as per requirement of the Section 102 of the Companies Act, 2013
To authorize the Director or Company Secretary to sign and issue notice of the General Meeting and to do such acts, deeds and things as may be necessary to give effect to the Board’s decision.
To authorize the Director or Company Secretary to sign and file requisite form and return with ROC.
Convene General Meeting [Section 96, 100 and SS-2]
Notice of General Meeting shall be given at least clear 21 days before the actual date of a General Meeting in writing, by hand or by ordinary post or by speed post or by registered post or by courier or by facsimile or by e-mail or by any other electronic means or a Shorter Notice can be issued with the consent of at least majority in number and ninety five percent of such part of the paid up share capital of the company giving a right to vote at such a meeting in accordance with Section 101.
Notice will be sent to all the Directors, Members, Auditors of Company, Secretarial Auditor, Debenture Trustees and to others who are entitled to receive the notice of the General Meeting.
Notice shall specify the day, date, time and full address of the venue of the Meeting and contain a statement on the business to be transacted at the Meeting.
Hold the General Meeting of Shareholders on fixed day and pass Ordinary Resolution for contribution to bona fide and charitable trusts etc.
File Form MGT-14 with ROC
File Form MGT-14 with the ROC within 30 days of passing Ordinary Resolution by the Public Limited Companies in General Meeting along with fee as specified in the Companies (Registration offices and fees) Rules, 2014 and with the following attachments;
Certified True Copies of the Ordinary Resolution passed in the General Meeting
Any other attachment as may be applicable.
Effectuate the Contribution
Pursuant to approval from board of directors and shareholder’s/ members company can contemplate to effectuate contributions to bona fide and charitable trusts etc.