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Authorised signatory

Aditya (Account Manager) (47 Points)

01 March 2011

Can an outsider,who is neither a employee nor Director nor professional consultant of a company, be a authorised signatory of share certificate of the company? Can Auditor of the company, be such authorise signatory?

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6 Replies

Shridhi Jain (Company Secretary) (1678 Points)
Replied 01 March 2011

Sealing and Signing of Certificate.-

Every share certificate shall be issued under the seal of the company, which shall be

affixed in the presence of

(i) two directors or persons acting on behalf of the directors under a duly registered

power-of-attorney ; and

(ii) the secretary or some other person appointed by the Board for the purpose. The

two directors or their attorneys and the secretary or other person shall sign the

share certificate.

Provided that, if the composition of the Board permits of it, at least one of the

aforesaid two directors shall be a person other than a managing or whole-time

director.

SANTOSH SHAH (Company Secretary) (754 Points)
Replied 01 March 2011

Originally posted by : Aditya
	Can an outsider,who is neither a employee nor Director nor professional consultant of a company, be a authorised signatory of share certificate of the company? Can Auditor of the company, be such authorise signatory?

Hello Mr.Aditya,

In my opinion, yes, an outsider i.e, auditor in this case can act as an authorized signatory if board passes resolution to that effect. An authorization from Board to outsider as Authorized signatory should do.

However it is always advisable to get it signed by Directors and a person associated with the company.

A share certificate is basically representing the company and thereby signatures of persons associated with the Company acting as Authorized Signatory along with 2 Directors and Common Seal will be a good practice.

Other views appreciated.

regards

Santosh Shah.

Jaideep (Service) (1368 Points)
Replied 01 March 2011

Originally posted by : SANTOSH SHAH
	In my opinion, yes, an outsider i.e, auditor in this case can act as an authorized signatory if board passes resolution to that effect. An authorization from Board to outsider as Authorized signatory should do. However it is always advisable to get it signed by Directors and a person associated with the company. A share certificate is basically representing the company and thereby signatures of persons associated with the Company acting as Authorized Signatory along with 2 Directors and Common Seal will be a good practice.

Vikash Kharvar (Dy. Manager -F&A) (469 Points)
Replied 02 March 2011

Yes,

A Auditor of the Company, may be authorised signatory for the Sahre Certificate of the Company.

But for the same Power of Attorney should be granted by Directors of the Company on behalf of that Auditor.

Pothuganty sudheer (Consultant, C.A, C.S) (411 Points)
Replied 02 March 2011

I agree with Santhosh,Jaideep and Vikas view. Good corporate practice demands the signature of directors on

Share certificate as they are the representing Company. However, persons other than directors can also be

authorised signatories on Share certificate on the strength of power of attorney or on the appointment by Board

to that effect by means of Board resolution.

Expert opinions are welcome and highly appreciated,

Best regards,

Jayashree S Iyer (Company Secretary) (3224 Points)
Replied 03 March 2011

As per Companies (Issue of Share Certificates) Rules, 1960 the share certificate shall be signed by

1) 2 directors or persons acting on behalf of directors under a duly registered Power of Attorney; and

2) Secretary or some other person appointed by the Board for that purpose.

So if persons other than directors are to sign the share certificate registered POA is required. It cannot be done on the basis of Board resolution alone.

Other experts veiws are solicited.