Contract when all directors are inetrested

I pvt.td. co. wants to take on rent , premises owned by Director on rent. How to take approval of Board when all two directors are interested as per 188. However No approval of Shareholder required. No new additional directors could be introduced. What to do to enter in to contract.

Replies (1)

You can pass the agenda item in the board meeting subject to the approval of the by disclosing the fact that all the directors are interested in the proposed resolution. Then you can ratify the resolution in the next general meeting.

Further, the resolution passed by interested director is voidable at the option of the company and not void ab initio. The only constraint is that directors are liable to penalty for participating in such meeting.

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