Change in designation of whole time director to MD

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Querist : Anonymous

Querist : Anonymous (Querist)

31 July 2010 A public limited company has taken approval of the central government for appoitnment of whole time director for the period 1st April, 2009 to 31st March, 2014.

However now the company wants to change the designation to Managing Director.

Pls advice with respect to the procedure tp be followed and the forms to be filed.

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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31 July 2010 DEAR ANONYMOUS,

YOU CAN GO TO THE FOLLOWING PATH:-

https://www.caclubindia.com/experts/appointment-of-managing-director-253120.asp

REGARDS

CA Sanat Pyne

CA Sanat Pyne (Expert)
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31 July 2010 The following are the steps involved in appointment of Mr. A as Managing Director in a Company who is not an Managing Director in any other Company:

1- Convene Board Meeting and pass resolution for appointment as Managing Director (sample of resolution specified hereunder) and fix date and approve notice of General Meeting for passing ordinary resolution or special resolution, as the case may be (explained hereunder)

2- Then follow the steps
3- Issue notice along with explanatory statement (sample of exp. St. specified hereunder) at least 21 days before the Extra-Ordinary General Meeting/Annual General Meeting

4- Hold the General Meeting and appoint Mr. A as Director u/s 257 and appoint him as Managing Director by ordinary resolution (sample specified hereunder).

5- If the prospective Managing Director is of 18 yrs. or > 70 yrs. of age then appointment has to be approved by Special Resolution in General Meeting.

6- Ensure that appointment is in accordance with the provisions of Schedule XIII to the Companies Act, 1956 otherwise Central Government approval is required by making an application in Form 25A.

7- File Form 23 within 30 days of passing resolution for appointment even if ordinary resolution is passed (See Section 192)

8- File Form 32 within 30 days of app. for change in designation from Additional Director to Managing Director.

9- File Form 25C within 90 days of appointment

10- Make necessary entries in the Register of Directors

NECESSARY RESOLUTIONS:

For Appointment as Managing Director :

“RESOLVED THAT pursuant to provisions of Section 269 read with Schedule XIII of the Companies Act ,1956 and sub to provisions of Sections 198 ,309,314 and other applicable provisions ,if ,any of the Companies Act, 1956 and further subject to approval of shareholders, sanction be and is hereby accorded to the re-appointment of Mr. A as Managing Director of the Company for a period of 1 (one) year with effect from 1st April,_________ and to the payment of the following remuneration:

a) Salary Basic Rs __________ PM

b) Conveyance on actuals upto a limit of Rs ___________PM

c) House Rent Rs _________ PM

Resolved Further That in the event of loss or inadequacy of profits during the tenure of service of the Managing Director, the payment of salary, commission, perquisites and other allowances shall be governed by the limits prescribed under Section II of Part II of Schedule XIII to the Companies Act, 1956.”

2- Explanatory Statement (Forming Annexure to Notice)

The Board, subject to the approval of shareholders in the General Meeting, appointed Mr. A as Managing Director of the Company effective 1st April _____________, for a period of one year on terms and conditions set out in the Resolution. He is a partner of _______________, an associate concern of the Company and Director in ________________ Ltd.

The remuneration as set out in the resolution is in accordance with the provisions of Schedule XIII to the Companies act, 1956.

The Board recommends the resolution for approval of Members.

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