Hello Members,
Please give your opinion in the following matter:
Section 316(2) states that a unanimous board resolution is required in case a public limited company wants to appoint a person as managing director who is already a managing director in any other company.
Now I want to know that when the unanimous board resolution is required? Can it be passed after the appointment of the said person as managing director or prior approval of board is required?
Thanks.
Prior approval of board is required.
Board resolution should be passed before the appointment of MD
Thanks for your replies frnds.
But nowhere in the section it has been mentioned that prior approval is required.
Please tell me the source of interpretration or any other source.
Thanks.
U need Board approval to appoint such a person as MD . And only after that u can appoint him. A Board Resolution is passed to Showing that Board is agreeing(with relevant Majority) to appoint him,
Main section in your case is section 269 and section 316 is just a secondary section. Considering the overall intention of law regarding appointment of MD, I can say that unanimous board resolution under section 316(2) is not a prior one.
Thankyou for your precious opinions members..
CAclubindia
