COMPANIES ACT, 1956
This query is : Resolved
31 March 2010
A Managing director in a unlisted public company was re-appointed for a period of 5 years say from 01.04.2005 but it was placed before the Board on 28.03.2010 and the Direcors have decided to call ann E.G.M during 1st week of april.
Query:
1. can this appointment be placed in the ensuing A.G.M for shareholders approval.
2.will he vacate the office as on 31.03.2010.
3. in this circumstances can he authenticate the Balance sheet.
Query:
1. can this appointment be placed in the ensuing A.G.M for shareholders approval.
2.will he vacate the office as on 31.03.2010.
3. in this circumstances can he authenticate the Balance sheet.
31 March 2010
Dear Kavitha,
Re-appointment of MD in a public company can be done by board meeting resolution subject to the approval of shareholders in a GM. If the term of your MD expires on 31.03.2010 there is no need to worry at all. Simply pass a board resolution before 31.03.2010 subject to the approval.
Remember one thing retrospective re-appointment of MD is not possible due to section 317 hence passing of BR before 31.03.2010 is mandatory.
As per DCA clarification the above practice is very much possible and there is no need to vacate office.
Revert if there is any doubt.
Re-appointment of MD in a public company can be done by board meeting resolution subject to the approval of shareholders in a GM. If the term of your MD expires on 31.03.2010 there is no need to worry at all. Simply pass a board resolution before 31.03.2010 subject to the approval.
Remember one thing retrospective re-appointment of MD is not possible due to section 317 hence passing of BR before 31.03.2010 is mandatory.
As per DCA clarification the above practice is very much possible and there is no need to vacate office.
Revert if there is any doubt.
31 March 2010
therefore it is clear that he can as well authenticate the Balance sheet provided the resolution is passed before 31.03.2010
31 March 2010
Also highlight that if a company can obtain approval of members in the subsequent A.G.M or passing of E.G.M is required.
31 March 2010
As per circular number 2/94 dated 10 February 1994—MD may initially be appointed by a board resolution subject to the approval of members in the general meeting and such approval may be obtained in the first general meeting of the company held immediately after his appointment by the board.
For my detailed reply kindly go through the link below:
https://www.caclubindia.com/forum/md-reappointment-74130.asp
Revert if there is any doubt.
For my detailed reply kindly go through the link below:
https://www.caclubindia.com/forum/md-reappointment-74130.asp
Revert if there is any doubt.
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