Fraud made by Directors

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Sajjan Agrawal (Querist)

11 July 2009 One of director have passed some confidential information to outsiders apart from this he has taken money from company's client and deposited it into his personal bank accounts. He is also holding 33% shareholding in the company and still holding the directorship in the company. The company is running in loss. What kind of different action a company take...Kindly help urgently.

CA. B.SRINIVASULU

CA. B.SRINIVASULU (Expert)

11 July 2009 File a civil suit for recovery of the amount collected by him alongwith damages.

File criminal suit that he has utilised the confidential information of the company.

Forfeit the shares towards damages.

Dismiss him from directorship and file form 32

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Sajjan Agrawal

Sajjan Agrawal (Querist)

13 July 2009 thanks for your suggestion Mr. Srinivasulu. Could you please let me know can we pass an ordinary resolution....

" RESOLVED that the board of directors has decided
 To bar Mr. RAM,Director for execuitng any financial,Operational activities on behalf of ABC Pvt. ltd and its Subsidiaries
 To initiate legal action against him to recover the financial losses incurred

FURTHER The board of directors has decied to inform all Clients,Business partners,Associates and all other concerned parties of its decision and request them not to carry out any financial transaction or agreement with Mr. Rakesh Dadhich ,for which the company would not be held responsible.

Ankur Garg

Ankur Garg (Expert)

13 July 2009 Yes you may remove him from directorship u/s 284 of the companies act, 1956 by passing an ordinary resolution of shareholders in the general meeting.

Remember court will not help you in his removal as long as section 284 is there for your help.

You should contact some corporate lawyer for proper redressal of your problem.

Regards

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Sajjan Agrawal

Sajjan Agrawal (Querist)

13 July 2009 Thanks Ankur, But at present we don't want to remove him from directorship. We only want to pass a resolution to the effect from barring him from execuitng any financial,Operational activities.

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