Governance

Green Initiative in Corp.Governance The Ministry of Corporate Affairs (“MCA”) has taken a Green Initiative in Corporate Governance by permitting electronic mode for service of documents to members (shareholders) after considering relevant provisions of the Information Technology Act, 2000 and Companies Act, 1956 (“the Act”). The Act provides for service of documents to members by the following modes 1.  Post (generally under certificate of posting to retain proof of dispatch), or 2.  Advertisement in a newspaper circulated in the neighborhood of the registered office, or 3.  Personal Delivery. The Information Technology Act which came into force in the year 2000 has an overriding effect over other laws in providing legal recognition of electronic records and digital signatures. Further, the Department of Posts has recently discontinued the ‘Certificate of posting’ services. Taking cognizance of the above, MCA has now clarified that service of documents to members can be now made by electronic mode provided the company has obtained the email addresses of the members by giving an opportunity to all members to register their email address and changes from time to time. If a member has not registered an email address, other permitted conventional modes of service would continue to be applicable. This initiative will ease the burden on corporates (and the environment) of sending physical documents such as notices, annual reports etc. by postal facility under ‘Certificate of Posting’.