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Director sec 161

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i am Kashif

372 Points Posted on 06 June 2021

Barkha Ltd. has four directors on its Board. A Board meeting was convened
which was attended by only two directors, where Rekha was appointed as an
additional director. Rekha is related to both the directors. Referring to the
provisions of the Companies Act, 2013, examine the validity of the appointment.

Replies (6)

Quick Summary

This discussion explores the validity of appointing an additional director, Rekha, to Barkha Ltd.'s board when only two of the four directors attended the meeting. While Section 161 of the Companies Act, 2013, is silent on appointments involving related parties, the consensus suggests such appointments are valid, particularly for private companies. Concerns typically arise only when resolutions are passed where an interested director is present.

CA. Sourav Sarkar

Chartered Accountant

24588 Points Posted on 06 June 2021

No Rekha cannot be eligible for appointment as additional director as she is related and have network with related parties

i am Kashif

372 Points Posted on 06 June 2021

Thanks

satya kumar

48 Points Posted on 06 June 2021

Sec. 161 is silent on the issue. when husband wife, two bothers can form a company, then where is embargo on appointing Rekha as director who is related party. only concerns come in the picture, when any resolution is being passed where either of the interested director is present.