Become GST Expert

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

MCA’S Green Initiative

In order to save trees and environment by cutting down the consumption of costly paper habits, the Ministry of Corporate Affairs has taken a “Green Initiative in the Corporate Governance” by allowing paperless compliances by the companies under the provisions of the Companies Act, 1956. Indian Corporate regulators have recognized the electronic mode to comply various provision of companies act, 1956.

A brief note:

Some of the important initiatives are as under :

(i) Allowing service of Documents including Balance Sheets and Auditors report etc through e-mail addresses :  General Circular No:17/2011 dated 21.04.2011

In order to reduce cost of posting and speedy delivery of documents, service of documents through electronic mode has been permitted under section 53 of the Companies Act, 1956 in place of  service of document under certificate of posting.

Similarly, to reduce the consumption of papers and speedy secure delivery, service of copies of Balance Sheets and Auditors Report etc., to the members of the company as required under section 219 of the Companies Act, 1956 has been allowed to be served through electronic mode by capturing their e-mail addresses available with the depositories or by obtaining directly from the shareholders.

(ii) Participation by Directors and shareholders in meetings through video conferencing : To provide larger participation and for curbing the cost borne by the Company, Directors, and shareholders to attend various meetings under the provisions of the Companies Act, 1956, participation through video conferencing has been permitted subject to certain compliances.


General Circular No:28/2011 dated   20.05.2011 Meetings of the board of directors may now be conducted using video conference facility. However, each director must physically attend at least one meeting each financial year. More importantly, the participation of a director through video conference facility will be counted towards quorum. There are a number of other checks and balances introduced in the arrangement to ensure authenticity and credibility of the proceedings.


General Circular No:27/2011  :- Similar to board meetings, shareholder meetings too can be held using video conferencing subject to inbuilt safeguards.

MCA now requires that listed companies “must provide video conferencing connectivity during such meetings at least five places in India”. This will ensure the shareholders need not travel across cities to attend general meetings, especially when meetings are held in interior locations that are not easily accessible.

While shareholders may participate electronically, the quorum required for the meeting will have to be present physically at the place of the meeting. As far as quorum is concerned, there seems to be a distinction between board meeting and shareholders’ meeting. This may introduce some practical difficulties in closely-held companies with a small number of shareholders where a minimum number of shareholders required to constitute quorum will still have to physically congregate at the location of the meeting.

(iii) Voting in General Meeting of Companies through electronic mode :  General Circular No:18/2011 dated 29.04.2011:- 

In order to have secured electronic platform for capturing accurate electronic processes, Central Depository Services (India) Ltd (CDSL)  and National Securities Depositories Limited (NSDL) are being given approval by the Ministry of Corporate Affairs to provide their electronic platform for capturing accurate electronic voting in General meetings of the company.

Under the new initiative, a company may comply with this section “if the services of document has been made through electronic mode provided the company has obtained –email addresses of its members for sending the notice/documents through e-mail by giving an advance opportunity to every shareholders to register their e-mail address and changes therein from time to time with the company”.

This is a useful change as it now eases the burden of sending bulky documents such as the annual report to shareholders in physical form, particularly because it is unlikely that many small shareholders would review these in any detail at all.

(iv) Issue of Digital Certificates by Registrar of Companies :  General Circular No:29/2011

The Registrar of Companies has to issue a number of certificates to the companies and other stakeholders as required under the provisions of the Companies Act, 1956. In order to cut timelines and an another step towards “Green Initiative” it has been decided that all certificates and standard letters issued by the Registrar of Companies will now be issued electronically under the Digital Signatures of the Registrar of Companies.

Here sec .53 deal only with the Members of the company, a Company can send the document by physically to the registered address or by electronically to his registered Email address and it is legally permitted now by MCA.



Great Steps……………… Save the Tree ,,,,,,, Save the Resources


Pravin Gupta

Published by

Pravin Gupta CS
Category Corporate Law   Report

1 Likes   72 Shares   21216 Views


Related Articles


Popular Articles

GST Course
caclubindia books caclubindia books

CCI Articles

submit article