additional director

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CA Devender Chauhan

Group Financial Accountant

1526 Points Joined March 2009

Our client is a foreign MNC. It is a private limited company. In the last year they have appointed 3 directors as Additional Director and the first directors retired in the board meeting. Now the problem is that we want to regularised the AD in the last year AGM. I want to know can we do that. The company is having only these 3 directors. If we regularise them who will have the signing authority. Also tell me is it a special business. If yes, then is it require explanatory statement. Please elaborate. If possible please quote the section also.

Replies (2)

Ankur Garg

Company Secretary and Compliance Officer

114788 Points Joined January 2009

Hello,

Yes it is a special business for which you have to prepare the explanatory statement as desired by section 173.

Regularisation of AD in previous AGM is possible subject to the mutual understanding with shareholders bcoz you have to amend your AGM notice. If you have already shared the original AGM notice with ROC or any other authority, then I would not advise you to go for back dated regularisation.

Otherwise prepare form 32 for regularisation and file with late fee. If there is any doubt let me know through PM.

Thanks

Ankur Garg

Company Secretary and Compliance Officer

114788 Points Joined January 2009

SAMPLE RESOLUTION FOR REGULARISATION

“RESOLVED THAT Ms. Sneha Bagla, who was appointed as an Additional Director with effect from December 10, 2009 on the Board of the Company in terms of Section 260 of the Companies Act, 1956 and Article 161 of Article of Association of the Company and who holds office up to the date of this Annual General Meeting, and in respect of whom a notice has been received from a Member in writing, under Section 257 of the Companies Act, 1956, proposing her candidature for the office of a Director, be and is hereby appointed as a director of the company.”

EXPLANATORY STATEMENT PURSUANT TO SECTION 173(2) OF THE COMPANIES ACT, 1956

ITEM NO. ______

Ms. Sneha Bagla was appointed as an Additional Director by the Board of Director w.e.f. December 10, 2009 in accordance with the provisions of Section 260 of the Companies Act, 1956 and Article 161 of Article of Association of the Company.

Pursuant to Section 260 of the Companies Act, 1956 the above director holds office up to the date of the ensuing Annual General Meeting. In this regard the Company has received request in writing from a member of the company proposing her candidature for appointment as Director of the Company in accordance with the provisions of Section 257 and all other applicable provisions of the Companies Act, 1956.

The Board feels that presence of Ms. Sneha Bagla on the Board is desirable and would be beneficial to the company and hence recommend resolution No. ____ for adoption.

None of the Directors, except Ms. Sneha Bagla is concerned or interested in this resolution.

The Board recommends resolutions under Item No. _____ to be passed as ordinary resolution.