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SRINIVASAN (Querist)

13 July 2012 A Private Limited company is a 100 % subsidiary of foreign company. Four Directors has been appointed in the board as the nominee director of a foreing company in the articles of association. Except the above no directors are appointed till one year.

My query is that, under the Indian Companies Act, 1956 is there any provision which mandates that atleast one director shall be present in the board except the nominee director (or) directors.

Thank you for your replies in advance.

Ajay Mishra

Ajay Mishra (Expert)

15 July 2012 Hi

Please see your articles about quorum. If it permit that quorum will be minimum one ordinary director and one nominee then it will be sufficient to comply quorum.

Yes, you can, but also note that you must comply the provisions of section 9 of the Companies Act, 1956.

Regards

SRINIVASAN

SRINIVASAN (Querist)

15 July 2012 Dear Ajay,

Thank you for reply. Section 9 of the Indian Companies Act, 1956 confers power to the act to Override the companies Memorandum, article,resolutions passed by the company in general meeting or by its by board of directors which are so much as repugnant to the provisions of the act.

My query is that, whether any section in the companies act, which mandates the company to have atleast one director other than the nominee director?

Thank you for your replies in advance.

Ajay Mishra

Ajay Mishra (Expert)

16 July 2012 Hi

No, The Companies Act, only says the company have at least two directors in private company and three directors in public company. It also not distinguish about ordinary director or nominee director for constituting the quorum.

In Case the director of the company is less than two or the no. of director fix for the quorum, then the remaining director (continuing director or directors) may act for the purpose of increasing the no. of directors to that fixed for the quorum or summoning a general meeting of the company, but no for other purpose.

Please read Regulation 75 of Table A of Schedule I of the Companies Act, 1956.

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