Who Can Sign a Contract for a Company? Board Resolutions, Delegation Matrices and Authorised Signatories in India

Every executed contract carries a silent question: did the person who signed have the authority to bind the company? For most day-to-day contracts nobody asks; in a dispute, an acquisition or an audit, everybody does. This guide explains how signing authority works for Indian companies, what the board resolution and the delegation matrix should contain, and how to keep the authority record with the signature record. Position as of October 2026.

The source of authority

A company acts through its board. The board may delegate powers to directors, committees, officers and employees, subject to the Companies Act, 2013 and the articles. Section 179 sets out the board's powers and the matters it must decide at board meetings; section 180 requires shareholder approval for certain matters (including borrowing beyond limits and sale of undertakings). Within those limits, the board delegates by resolution.

Counterparties dealing with a company in good faith are generally protected by the indoor management principle (they may assume internal procedures were followed), but relying on that in a dispute is slower and less certain than having the resolution on file.

The board resolution

A signing-authority resolution should state:

• The person(s) authorised, by name and designation.
• The scope: contract types and value limits (for example, "customer and vendor agreements up to Rs 2 crore in aggregate annual value").
• Whether authority is sole or joint (any two of the named persons above a threshold).
• The power to sub-delegate, if any.
• The validity period and revocation on cessation of office.
• Authority to execute electronically with the company's DSC or Aadhaar eSign.

Certified true copies are what counterparties and banks ask for; keep a current set.

The delegation-of-authority (DoA) matrix

The resolution sets the outer limit; the matrix operationalises it. A matrix lists contract types down the side and value bands across the top, with the approver and the signatory in each cell. It is the document the contract workflow should enforce: a Rs 5 crore agreement routed to a manager authorised to Rs 50 lakh should be blocked, not signed and discovered later.

How counterparties check

• Ask for the certified board resolution and, for larger deals, the articles.
• Check the signatory's designation on the MCA record for directors and key managerial personnel.
• For DSC signatures, the certificate names the holder; for Aadhaar eSign, the audit trail names the signer. Neither proves authority; the resolution does.

Keeping authority and execution together

The common failure is that the resolution lives with the company secretary and the signed contract lives in a shared drive. The record for each executed contract should hold: the contract; the stamp certificate; the signature audit trail; and a reference to the resolution or matrix entry under which the signatory acted. When a signatory leaves, the revocation should be recorded and the contracts they signed remain valid (authority is judged at the time of signing), while new requests route elsewhere.

Electronic execution and authority

The IT Act, 2000 recognises electronic signatures (sections 3, 3A, 5); it does not confer authority. A company's DSC held by a former employee is a risk: revoke the certificate with the Certifying Authority on exit, and remember that fraudulent use of another's electronic signature is an offence under section 66C.

Where Legatio fits. Legatio enforces the DoA matrix in the approval workflow, routes documents to the authorised signatory for DSC or Aadhaar eSign, and stores the resolution reference with each executed contract. The resolution and the matrix are governance decisions for the board.

Position stated as of October 2026. General information, not legal advice.