274 (1)(g)

yes he can be appointed as director of pvt ltd. company, the restriction applies for being  director of public limted company.

He can be appointed as a director of a Private company. He is disqualified to be appointed as a director of a public company.

Chaitanya

thank You so much !!! :)

Any director who is disqualified u/s 274(1)(g) of the Companies act, 1956, can  be appointed as Director in any private company other than subsidiary of Public co or Public Ltd. Co.

Any director who is disqualified u/s 274(1)(g) of the Companies act, 1956, can  be appointed as Director in any private company other than subsidiary of Public co or Public Ltd. Co.

Dear Nirmala,

Sec 274(1) starts with the opening statement that "A person shall not be capable of being appointed director of a company, if - ..."

It does not distinguish between a Pvt co and a Public co.

Clause(g) additionallay states that ".... such person shall not be eligible to be appointed as a director of any other public co for a period of 5 years...."

So I interpret that, when the default continues such person cannot be appointed as a director in any co's and when the default is made good, such person can be appointed as a director in a pvt co but he can be appointed as a director in a public co only after a period of 5 years from the date of such default.

Is there any one agreeing to my interpretation?

274 (1)(g)

A person shall not be capable of being appointed as a director of public company if he is already a director of a public company which has failed to repay its deposits or interest thereon....and such failure continues for one year or more

in the above situation which directors are disqualified..

*person who was a director when the default was committed and also continued for one year & beyond

*person who was appointed after the default was committed and continued to be in office beyond 1 year from the date of default.

*person who resigned before the expiry of one year

* a person who was appointed after the expiry of one year frm the date of default

Dear Nirmala!

274(1)(g) clearly says that at the time of appointment such person should not be a director in the defaulting co as mentioned in sub clause (A) and (B).

The offence should be a continuing offence, i.e at the time of appointment if the offence is made good then he will not be disqualified for appointment.

To the best of my knowledge the solution to your questions may be as follows: 

*person who was a director when the default was committed and also continued for one year & beyond

The qualifying default is only when the offence is continuous for one year or more, therefore if he is a director after the expiry of 1 year from the due date for payment then he will be disqualified for appointment as a director in other Co's.

*person who was appointed after the default was committed and continued to be in office beyond 1 year from the date of default.

While at the time of appointment such failure to pay already exceeded 1 year from the due date  then such director is disqualified for appointment as a director in other Co's.

*person who resigned before the expiry of one year

Before the expiry of 1 year the default is deemed not to have committed as the act says only when the failure continuous for 1 year or more, therefore the person is not disqualified.

* a person who was appointed after the expiry of one year frm the date of default

After the expiry of one year from the due date for payment it becomes a qualifying offence under the Section and hence whoever is a director during the period becomes disqulaified from being appointed as a director in other Co's.