The Secretarial Standards on Board Meetings (SS-1) and General Meetings (SS-2) are mandatory for all companies. A non-compliance is reported by the secretarial auditor in Form MR-3, and it can attract penalty under the Companies Act. The remediation of a non-compliance is not a matter of simply holding a fresh meeting; it requires an examination of the defect and a corrective process.
The Common Defects
The common SS-1 defects include the failure to give the required notice, the short notice without the requisite consent, the absence of the quorum, the failure to record the deliberations, and the circulation of the minutes within the prescribed period. The common SS-2 defects include the defective notice, the incomplete explanatory statement, the failure to provide the e-voting facility, the defective proxy register, and the inaccurate recording of the proceedings.
The Remediation
The remediation depends on the nature of the defect. A procedural defect in the notice can be cured by convening a fresh meeting with the proper notice. A defect in the minutes can be cured by the board's approval of the corrected minutes at the next meeting. A defect in the general meeting resolution can be cured by the ratification of the resolution at a subsequent meeting, subject to the limitation that a substantive defect—such as the absence of the requisite majority—cannot be cured by ratification.
The Secretarial Audit
The secretarial auditor must report the non-compliance in Form MR-3, and the board must explain the non-compliance in the board's report. The remediation should be documented, and the secretarial auditor should be informed of the corrective steps. A company that remediates the non-compliance before the audit can avoid an adverse observation.
The Consultant's Role
A secretarial compliance consultant conducts a gap assessment, identifies the defects, designs the remediation plan, and coordinates the fresh meetings and the filings. The consultant also prepares the company for the next secretarial audit and ensures that the standards are embedded in the company's processes.
Call to Action
Anuj Desai & Associates advises companies on the SS-1 and SS-2 non-compliance remediation—from the gap assessment and the defect analysis to the corrective meetings and the secretarial audit preparation. If your company has an adverse secretarial audit observation, we can help you remediate it.
📧 office@anujdesaiassociates.com
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🌐 https://anujdesaiassociates.com
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