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Appointment of New Director

pooja (1) (139 Points)

06 May 2011

Hello,

My query is if company wants to appoint a new director in place of retiring director in annual general meeting & his appointment is not yet decided in coming board meeting & retirement of that director has not proposed in board meeting. I want to know the method by which i can appoint the new director & retirement of the director in annual general meeting directly in AGM

Thanks

Pooja

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3 Replies

nidhigoel89 (Company Secretary ) (594 Points)
Replied 06 May 2011

Hello,

Whatever decision u want to take in AGM should be incorporated in the AGM notice. So, whenver u are adopting the AGM notice make sure that appointment and reappointment of Director isconfirmed and due information has been given in AGM notice.

Other views are welcomed!

Thanks

Nidhi

Rachit (Ca-Final Article.) (565 Points)
Replied 06 May 2011

By passing A resolution ...................

i dont know what are the method for appointment of director what i know only is the appointment of the director /retirement usually take place in AGM by passing an ordinary resolution for appointment of the same director who is going to be retired and Special resolution in case of a new Director.............

RG - A Helping Hand (Company Secretary) (13867 Points)
Replied 06 May 2011

Hi Pooja,

Let me tell you the practical aspects. Here I’m presuming that you have enough number of directors on board as far as minimum number of directors is concerned.

For the retirement of a “retiring director nothing is required to be done”. Let him retire in the AGM and put a resolution for his/her usual retirement through rotation system and do not proposed to re-appoint him in the AGM. There is no need to formally propose the retirement of a “retiring director” in the board meeting. Because the system of Rotational retirement of director is automatic read with section 255 and 256.

For the induction of a new board member kindly observe the points below:

1. To appoint a new board member this agenda should be a part of AGM notice.

2. However if you are not sure about the candidate then let the vacancy prevail and you may appoint the new director after AGM in the form of an additional director.

3. Let me further inform you that it is not necessary to follow the route of appointment as additional director u/s 260 as you may directly appoint a new director in general meeting u/s 257 with shareholders approval.

So if you want to use that flexibility you have to decide the name of proposed director and put the agenda of his appointment in the AGM notice in order to enable his appointment in the AGM.

On the other hand you may appoint him in board meeting as additional director u/s 260 after the AGM

Regards

Richank