Appointment of manager
This query is : Resolved
19 September 2013
Suppose a Mr. X is employee in "ABC" Company and also non executive Director in "XYZ" Company.
now company XYZ wants to appoint him as manager without any remuneration, under section 269 of the companies act, 1956.
Can XYZ do so? if yes are there any specific provisions in companies Act, to take stand to support this decision?
now company XYZ wants to appoint him as manager without any remuneration, under section 269 of the companies act, 1956.
Can XYZ do so? if yes are there any specific provisions in companies Act, to take stand to support this decision?
19 September 2013
Hi
Yes, they can do so.
Section 386(2) provides that a company may appoint or employ a person as its manager if he is the manager or managing director of one, and not more than one other company. Moreover, such appointment or employment shall be made or approved by a resolution passed at a meeting of the Board with the consent of all the directors present at the meeting, and of which meeting and of the resolution to be moved thereat, specific notice has been given to all the directors then in India.
However, the Central Government may, by order, permit any person to be appointed as a manager of more than two companies, if the Central Government is satisfied that it is necessary that the companies should, for their proper working, function as a single unit and have a common manager. Section 386 does not apply to an independent private company [section 388A]. Further, a Government Companies is also exempted from the provisions of this section.
Yes, they can do so.
Section 386(2) provides that a company may appoint or employ a person as its manager if he is the manager or managing director of one, and not more than one other company. Moreover, such appointment or employment shall be made or approved by a resolution passed at a meeting of the Board with the consent of all the directors present at the meeting, and of which meeting and of the resolution to be moved thereat, specific notice has been given to all the directors then in India.
However, the Central Government may, by order, permit any person to be appointed as a manager of more than two companies, if the Central Government is satisfied that it is necessary that the companies should, for their proper working, function as a single unit and have a common manager. Section 386 does not apply to an independent private company [section 388A]. Further, a Government Companies is also exempted from the provisions of this section.
20 September 2013
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