(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-
(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.
Section 189 of the Companies Act, 2013 deals with disclosure of interest by directors. It mandates directors to disclose their interest in any contract or arrangement entered into or proposed to be entered into by the company. This includes their interest in any other entity that is a party to such a contract or arrangement. They are required to disclose their interest at the board meeting in which the contract or arrangement is discussed. If they become interested in a contract or arrangement after its approval, they must disclose their interest at the next board meeting. The details of the disclosure made by directors are required to be recorded in the minutes of the board meeting. Non-compliance with the disclosure requirements of this section may lead to penalties for the director and the company. This helps prevent conflicts of interest and protects the interests of shareholders and stakeholders.