Sections 378U and 378V explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 378U lets the Board of a Producer Company form committees to assist it, but never to take over its powers. Section 378V sets the meeting rhythm: at least four Board meetings a year and at least one every three months, written notice of not less than seven days, and a quorum of one-third of the directors, subject to a minimum of three.
The Board may form committees, but it cannot delegate any of its powers or the Chief Executive's powers to a committee (section 378U(1) proviso). Minutes of each committee meeting go to the next Board meeting. The Board meets not less than once in every three months, with at least four meetings a year; written notice is due not less than seven days before, or the Chief Executive pays a penalty of five thousand rupees (section 378V(3)). Shorter notice is allowed if the reasons are recorded in writing. The quorum is one-third of total strength, subject to a minimum of three. The Bill 2026 does not amend these sections.
Both sections are about process, and process is proved by records; see our board resolution and legal documents service for notices, agendas and minutes.
The two sections at a glance
| Section | Subject | Key point |
|---|---|---|
| 378U | Committees | Assist the Board; no delegation of Board or Chief Executive powers; minutes to the next Board meeting |
| 378V | Board meetings and quorum | Four a year, every three months; seven days' notice; quorum one-third, minimum three |
Section 378U: committees of directors
| Sub-section | What it says |
|---|---|
| (1) | The Board may constitute committees to assist it in the efficient discharge of its functions. Proviso: the Board shall not delegate any of its powers, or assign the powers of the Chief Executive, to any committee |
| (2) | A committee may, with the Board's approval, co-opt persons as members. Proviso: the Chief Executive appointed under section 378W, or a director of the Producer Company, shall be a member of the committee |
| (3) | Every committee works under the general superintendence, direction and control of the Board, for such duration and in such manner as the Board directs |
| (4) | Fees and allowances for committee members are determined by the Board |
| (5) | The minutes of each committee meeting are placed before the Board at its next meeting |
The proviso to sub-section (1) matters most. Under section 378R, Board powers are exercised by resolution at a Board meeting; see section 378R. A committee for, say, procurement or finance can study, prepare and recommend, but the decision remains with the Board. The text of the proviso to sub-section (2) says the Chief Executive "or" a director shall be a member; it does not say both are needed.
Section 378V: meetings of the Board
| Sub-section | Rule |
|---|---|
| (1) | A Board meeting is held not less than once in every three months, and at least four meetings in every year |
| (2) | Written notice of every meeting goes to every director for the time being in India, and at his usual address in India to every other director |
| (3) | The Chief Executive gives notice not less than seven days before the date of the meeting; failing which he is liable to a penalty of five thousand rupees. Proviso: a meeting may be called at shorter notice and the Board records the reasons in writing |
| (4) | Quorum: one-third of the total strength of directors, subject to a minimum of three |
| (5) | Save as the articles provide, directors (including the co-opted director) may be paid fees and allowances for attendance, as decided by the Members at the general meeting |
Two tests for frequency. Sub-section (1) sets both a gap and a count. There must be a meeting at least once every three months, and at least four in the year. Four meetings spaced, say, in the first six months and none in the last six would satisfy the count but not the three-month rule.
Notice. The duty to give notice sits on the Chief Executive and the penalty falls on him. For the role, see section 378W and 378X. The notice must be in writing, and the address rules differ for directors in India and for others. The text refers to the seven days as the period "prior to the date of the meeting"; count the days with care and keep proof of dispatch. The Board's decision to call a meeting at shorter notice, with recorded reasons, is how an urgent meeting stays valid.
Quorum examples. The quorum is one-third of the total strength of directors, but not fewer than three.
| Total directors | One-third | Quorum (minimum three) |
|---|---|---|
| 5 | 1.67 | 3 |
| 9 | 3 | 3 |
| 12 | 4 | 4 |
| 15 | 5 | 5 |
The last column is worked from the rule in sub-section (4): the higher of one-third and three. Where one-third is not a whole number, the text does not say how to round; the safe course is to take the next whole number. Section 378G(3)(d) also requires the articles to deal with voting procedure by directors at Board meetings and the Chairman's casting vote.
Why minutes matter
Board resolutions under section 378R, recommendations under section 378S and the defence against liability under section 378T all rest on records. Notice, attendance, quorum and reasons for short notice should all be in the minutes. Our board resolution and legal documents service covers drafting of notices, agendas and resolutions for the Board.
A worked example
A Producer Company with nine directors holds Board meetings in April, July, October and January. In July, an urgent vendor contract needs approval on two days' notice. The Chief Executive sends written notice, and the Board records in writing why the meeting is called at shorter notice. Three directors attend. Nine directors give a one-third figure of three, which equals the minimum, so three is the quorum and the meeting can proceed. At the next meeting, the Chief Executive tables the minutes of the finance committee formed earlier, as section 378U(5) requires.
Proposed change
The Corporate Laws (Amendment) Bill, 2026 amends other provisions of Chapter XXIA (sections 378P, 378Q, 378Y, 378ZA, 378ZF, 378ZM and 378ZS), but our search found no clause amending section 378U or 378V. The Bill is pending and is not law.
Need help with Board meetings and resolutions?
A Producer Company's meeting calendar, notices and committee records are easy to get wrong when the company is new. Our board resolution and legal documents team can help you prepare notices, minutes and resolutions that match sections 378U and 378V.
Key takeaways
- A committee assists; it cannot receive the Board's or the Chief Executive's powers.
- Committee minutes go to the next Board meeting.
- The Board meets at least once every three months and at least four times a year.
- Notice is in writing, not less than seven days; the Chief Executive faces a Rs 5,000 penalty if he fails. Shorter notice needs recorded reasons.
- Quorum: one-third of total strength, minimum three.
Read next
- Section 378R: powers of the Board
- Sections 378S and 378T: general meeting matters and director liability
- Sections 378W and 378X: Chief Executive and Secretary
- Producer Company compliance requirements checklist
Disclaimer: Based on the Companies Act, 2013 as amended up to 1 April 2021 (official consolidated text), read with later developments noted in the article; proposals in the Corporate Laws (Amendment) Bill, 2026 are pending and not law as on 30 September 2026. Verify current notifications and rules before acting.