Md vs. power of attorney

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Guest

Guest (Querist)

16 April 2013 Dear Experts, I read a specimen of Power of Attorney where MD was given the said powers.

My query is that who has more powers, the POA or the MD? Whose position is more crucial to the company? The POA or the MD?

also, the numerous powers entrusted in the specimen are by virtue of person being an MD or every POA has them..?

Ankit

Ankit (Expert)

17 April 2013 Dear Disha,

It is not that who is more powerful or who is more superior.

the POA is given by the company and not be a particular person. the person signing the POA is just doing so on behalf of the company.

For eg. many times, the agreement for appointing the MD,is signed by the Company Secretary of the company. now, obsiously, the MD is more powerful than the CS. but, here, in this case, even though the agreement is signed by the CS, does not mean that he is appointing the MD. he is just signing on behalf of the company.

so, the person signing the POA may also be just a manager level employee of the company or may be the chairman also.

so, the superiority of the person is to be decided by the rank he holds and not by the POA.

- Ankit

Guest

Guest (Querist)

17 April 2013 Thanks a lot Ankit Sir! My doubt was particulary that when MD is given the POA then powers entrusted on him in the specimen I read, were due to being given POA or else by virtue of being a MD as well.

Thank you for the valuable input.

Ankit

Ankit (Expert)

18 April 2013 You are welcome Disha...

on becoming an MD, certain powers come with the position...others have to be given by a POA passed in a Board Meeting....

so something like investment of company's funds upto a certain limit or signing of cheques upto a certain amount etc are given by a Board Resolution.