Change in status of director

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Querist : Anonymous

Querist : Anonymous (Querist)

05 September 2013 please suggest procedure for change in status of director from non-executive to executive director in a unlisted public limited company.

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013 Hi

Call a remuneration committee to finalise the terms or remuneration of such director. The Committee then send resolution with their comments to the Board of Directors.

Then Board of Director will change the designation and take note on the recommendation of Committee on remuneration and appoint him as executive director.

In next General meeting you will pass a shareholder resolution for above matter under section 309 of the Companies Act, 1956.

A

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2013 Thanks a lot sir, and is it compulsory to fili Form-32, 23 and form 25C

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013 Hi

If you are covered under section 269 then all these forms are required to be filed.

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2013 1. and co. can have all the director as executive director ?

2. and all the director are promoter director so, it is difficult to compose remuneration committee.

3. so is it als compulsory for the co. to have min 3 independent director to compose remuneration committee.

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013 Hi

This Independent Director provision is applicable only to listed company and not for unlisted company.

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013
Meaning of Remuneration Committee as explained under Explanation IV to the Section II of Part II has been substituted by Notification No GSR 70 (E), dates 08.02.2011, namely:-
For the purpose of this section, “Remuneration Committee” means:
(i) In respect of a listed company, a committee which consists of at least three non-executive independent directors including nominee director or nominee directors, if any; and
(ii) In respect of any other company, a Remuneration Committee of directors.

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2013 hi

I have 4 Director and all are promoter in the co., hence I can create Remuneration committee.

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013 yes you can create remuneration committee.

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2013 but all are executive and there is no non-executive director then als I can create...

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2013 and can co. pay remuneration to all the 4 executive director considering schedule XIII.

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013 If all director are interested then their remuneration will be decided by General meeting.

definition of remuneration committee given in Sechedul XIII does not talk about executive or non executive director. So remuneration committee will decide remuneration and general meeting will approve the remuneration of executive director.

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2013 thanks a lot Mishraji

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