Section 189 Register of contracts or arrangements in which directors are interested – Companies Act 2013

Amended and updated notes on section 189 of Companies Act 2013. Provisions for register of contracts or arrangements in which directors are interested.

Amended and updated notes on section 189 of Companies Act 2013. Detail discussion on provisions and rules related to register of contracts or arrangements in which directors are interested.

Chapter XII (Sections 173195) of the Companies Act, 2013 (CA 2013) deals with the provisions related to meetings of board and its powers. Section 189 of CA 2013 provides for register of contracts or arrangements in which directors are interested.

Recently, we have discussed in detail section 188 (Related party transactions) of CA 2013. Today, we learn the provisions of section 189 of Companies Act 2013.

The provisions of section 189 are effective from 1-April-2014. You may refer Notification No. S.O. 902(E) issued dated 27-03-2014. In this article, you will learn detail of the provisions of section 189 of the Companies Act 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014.

Name of ActThe Companies Act 2013
Enacted byParliament of India
Administered byMinistry of Corporate Affairs (MCA)
Number of Chapters29
Number of Sections484 (470-43+57)
Number of Schedules7
You are reading:
Chapter No.XII
Chapter NameMeetings of Board and its Powers
Section No.189
Section NameRegister of contracts or arrangements in which directors are interested
Monthly Updated EditionCompany Law PDF

Section 189 of Companies Act 2013: Register of contracts or arrangements in which directors are interested

Section 189 shall come into force on 1st April, 2014 vide Notification No. S.O. 902(E) issued dated 27.03.2014.

(1) Every company shall keep one or more registers giving separately the particulars of all contracts or arrangements to which sub-section (2) of section 184 or section 188 applies, in such manner and containing such particulars as may be prescribed and after entering the particulars, such register or registers shall be placed before the next meeting of the Board and signed by all the directors present at the meeting.

(2) Every director or key managerial personnel shall, within a period of thirty days of his appointment, or relinquishment of his office, as the case may be, disclose to the company the particulars specified in sub-section (1) of section 184 relating to his concern or interest in the other associations which are required to be included in the register under that sub-section or such other information relating to himself as may be prescribed.

(3) The register referred to in sub-section (1) shall be kept at the registered office of the company and it shall be open for inspection at such office during business hours and extracts may be taken therefrom, and copies thereof as may be required by any member of the company shall be furnished by the company to such extent, in such manner, and on payment of such fees as may be prescribed.

(4) The register to be kept under this section shall also be produced at the commencement of every annual general meeting of the company and shall remain open and accessible during the continuance of the meeting to any person having the right to attend the meeting.

(5) Nothing contained in sub-section (1) shall apply to any contract or arrangement—

  • (a) for the sale, purchase or supply of any goods, materials or services if the value of such goods and materials or the cost of such services does not exceed five lakh rupees in the aggregate in any year; or
  • (b) by a banking company for the collection of bills in the ordinary course of its business.

(6) Every director who fails to comply with the provisions of this section and the rules made thereunder shall be liable to a penalty of twenty-five thousand rupees.

Exception/ Modification/ Adaptation:

1) In case of Section 8 (Non-profit) Companies, Section 189 shall apply only if the transaction with reference to section 188 on the basis of terms and conditions of the contract or arrangement exceeds one lakh rupees. – Notification No. G.S.R. 466(E) dated 5th June, 2015.


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