ROTATIONAL DIRECTORS

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 July 2010 AS PER PROVISIONS OF SECTION 255 OF THE COMPANIES ACT, 1956 THE TOTAL NUMBER OF ROTATIONAL DIRECTORS SHALL BE 2/3RD OF TOTAL STRENGTH OF DIRECTORS. REMAINING 1/3RD OF THE TOTAL STRENGTH OF DIRECTORS CAN BE NON ROTATIONAL DIRECTORS.

NOW THE QUERRY IS:
IF THE TOTAL STRENTH OF THE COMPANY IS 5 DIRECTORS, THE MINIMUM NO. OF ROTATIONAL DIRECTORS SHALL BE 3 DIRECTORS OR 4 DIRECTORS.?

P.S.
THE PROVISIONS CONTAINED IN SECTION 256 PROVIDES THAT 1/3RD OF THE NO. OF ROTATIONAL DIRECTORS SHALL RETIRE AT EACH AGM. IT ALSO PARTICULARLY SPECIFIES THAT IF THE NUMBER IS NOT IN MULTIPLE OF 3 THAN HOW IT SHOULD BE COMPUTED. THERE IS NO SIMILAR METHOD SPECIFIED IN SECTION 255.

Rasesh

Rasesh (Expert)

27 July 2010 In my view, 3 directors would be non-rotational (conservative approach) and the balance have to retire by rotation.

Querist : Anonymous

Querist : Anonymous (Querist)

28 July 2010 Thanks for your reply. But, the question is if there are two non rotational directors, than to comply with section 255 whether 5 shall be the total strength of the board or 6 directors shall be the total strength of the board. To put it in more lucid form, if the total strength of the board is 5 than, 2/3rd is 3.33. since the number 3.33 is in fraction, whether 5 shall be the total strength or 6?