Directors' Duties and responsibilities

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indira (Querist)
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26 October 2009 Dear all,

One of my friend is holding 26% of shares of a pvt ltd company registered as nbfc under rbi guidelines.

1) is it mandatory for him to become a director?
2) If he is an inactive board member is he liable for any mis-dealings, representations by the company?

Ankur Garg

Ankur Garg (Expert)
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26 October 2009 No. It is not mandatory for him to become a director.

But if he chooses to be a director then he is prima facie liable for all the activity and representations made by the company.

Regards

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