What is the difference between ordinary and special resolutions?
How a board resolution differs from an ordinary and a special resolution under the Companies Act, 2013: who passes each, the majority section 114 requires, and which decisions need which resolution.
In this guide
A board resolution is passed by the directors at a board meeting to decide management matters. An ordinary resolution is passed by members when votes in favour exceed votes against, a simple majority under section 114(1). A special resolution needs votes in favour of at least three times the votes against, a three-fourths majority under section 114(2), and applies to major decisions such as altering the MOA or AOA.
What are the three resolution types?
A company decision is recorded as a board resolution, an ordinary resolution, or a special resolution, and the three differ by who passes them and the majority needed. A board resolution is a directors' decision. An ordinary resolution is a members' decision on a simple majority. A special resolution is a members' decision on a three-fourths majority under section 114 of the Companies Act, 2013.
Getting the type right matters because the wrong resolution can make an action invalid. A decision that the Act reserves for a special resolution does not stand if it was only passed as an ordinary one.
What is a board resolution?
A board resolution is a decision the directors pass at a board meeting, or by circulation where the Act allows it. It covers matters within the board's powers, such as opening a bank account, approving a routine contract, or appointing the first auditor within 30 days of incorporation. It is passed by a majority of the directors present and voting where quorum is met.
Some board decisions cannot be passed by circulation. The powers listed in section 179(3), such as borrowing money or approving financial statements, must be exercised at a board meeting by resolution.
What is the quorum for a board meeting?
Section 174(1) of the Companies Act, 2013 sets the quorum at one third of the total strength or two directors, whichever is higher. Directors participating by video conferencing count towards that quorum. Where the number of interested directors leaves fewer than two disinterested directors present, section 174(3) makes the remaining disinterested directors the quorum, provided they number at least two.
Which board matters cannot go by circulation?
Section 179(3) reserves twelve classes of decision for a board meeting, including making calls on shares, authorising buy-back, issuing securities, borrowing money, investing company funds, granting loans or guarantees, approving the financial statements and the Board's report, diversifying the business, approving amalgamation, and taking over another company. Rule 8 of the Companies (Meetings of Board and its Powers) Rules, 2014 adds further items to that list.
What is an ordinary resolution?
An ordinary resolution is a members' resolution that passes when the votes cast in favour exceed the votes cast against, a simple majority under section 114(1). It is the default for members' decisions that the Act does not specifically require to be special, such as adopting financial statements or appointing a director in the normal course.
The notice must have been duly given, and the vote can be on a show of hands, electronically, on a poll, or by postal ballot where allowed. The chairman's casting vote, if any, counts.
What majority does a special resolution need?
A special resolution is a members' resolution that passes only when the votes cast in favour are at least three times the votes cast against, a three-fourths majority under section 114(2). The notice of the meeting must state the intention to propose the resolution as a special resolution.
Special resolutions are reserved for major decisions. Altering the memorandum under section 13, altering the articles under section 14, and a private company approving a loan to an entity in which a director is interested under section 185 all require a special resolution.
Which decisions need a special resolution?
The resolution type follows the decision. The table maps common decisions to the resolution the Companies Act, 2013 requires.
| Decision | Resolution | Majority |
|---|---|---|
| Open a bank account or routine contract | Board resolution | Majority of directors present |
| Adopt financial statements at the AGM | Ordinary resolution | Simple majority |
| Alter the MOA or AOA | Special resolution | Three-fourths majority |
| Loan to an entity a director is interested in | Special resolution | Three-fourths majority |
Why do company resolutions turn out invalid?
- Passing an ordinary resolution where the Act requires a special resolution, which leaves the action invalid.
- Failing to state in the notice that a resolution is proposed as a special resolution.
- Passing a section 179(3) matter by circulation instead of at a board meeting.
- Treating a board resolution as enough for a decision reserved for the members.
- Counting an abstention as a vote against when computing the special resolution majority.
Where are meeting and resolution rules changed?
The resolution rules sit in the Companies Act, 2013, and the procedural detail around meetings and filings moves through MCA notifications. Complied AI keeps MCA updates in one feed so you can open the notification behind a change, then read section 114 and the related sections next to it when you need the exact majority wording.
Practical checks
Common questions
What majority does a special resolution need?
A special resolution under section 114(2) needs the votes cast in favour to be at least three times the votes cast against, which is a three-fourths majority. The notice of the meeting must also state the intention to propose the resolution as a special resolution.
What is the difference between an ordinary and a special resolution?
An ordinary resolution passes on a simple majority, meaning votes in favour exceed votes against, under section 114(1). A special resolution needs a three-fourths majority under section 114(2) and is reserved for major decisions such as altering the memorandum or articles. The notice must flag a special resolution in advance.
Who passes a board resolution?
A board resolution is passed by the directors at a board meeting, or by circulation where the Act allows. It decides matters within the board's powers, such as opening a bank account, appointing the first auditor, or approving borrowing within limits, rather than matters reserved for the members.
Does a board resolution need a specific majority?
A board resolution is generally passed by a majority of the directors present and voting at a validly convened meeting with quorum. Certain matters under section 179 must be decided only at a board meeting and cannot be passed by circulation.
Which decisions need a special resolution?
A special resolution is needed for decisions such as altering the MOA under section 13, altering the AOA under section 14, reducing share capital, and a private company approving loans to entities in which a director is interested under section 185. The Act names the specific majority for each such action.
Can a resolution be passed without a meeting?
Members' resolutions can be passed by postal ballot under section 110 of the Companies Act, 2013 in the cases rule 22 of the Companies (Management and Administration) Rules, 2014 specifies. Board resolutions can pass by circulation under section 175, except for the twelve classes of matter section 179(3) reserves for a board meeting.
We passed an ordinary resolution to change our object clause. Is that a problem?
Yes, that resolution is defective. Section 13(1) of the Companies Act, 2013 requires a special resolution to alter the memorandum, including the object clause, so a simple-majority vote does not carry it. Pass a fresh special resolution with the three-fourths majority under section 114(2) and file Form MGT-14 within 30 days.
Two of our five directors are interested in a contract. Do we still have quorum?
Yes. Section 174(3) of the Companies Act, 2013 provides that where interested directors exceed or equal two thirds of the total strength, the remaining disinterested directors form the quorum, provided they number at least two. With three disinterested directors out of five, the ordinary quorum under section 174(1) of two directors is met anyway.
Do special resolutions have to be filed with the ROC?
Yes. Section 117(1) of the Companies Act, 2013 requires a copy of every resolution listed in section 117(3), which includes special resolutions, to be filed with the Registrar in Form MGT-14 within 30 days of passing. Section 117(2) sets a penalty on the company and on every officer in default for missing that filing.
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This guide is published by the Complied AI research desk. Its source list and stated position were checked against the official records shown below on 4 September 2026.
Automation, including AI, may assist research, drafting and structure. It does not replace the official record or amount to an independent professional review. Read our editorial standards and corrections policy.
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