directors

1038 views 5 replies

karn

trainee

172 Points Joined May 2009

Dear All,

Plz solve the following queries:

1) How we will come to know that a person is an executive director, we will check whether the person is on pay roll basis or not, Is it the only and foremost certiria.
2) Is it necessary that our MD should be in pay roll basis, I mean can a MD be executive or non executive.
3) Wat about whole time director, how u will decide that u should appoint WTD/MD,
4) In clause 49 of listing agreement you will find the chairman concept, who is chairman of company, is it a administrative term or legal term, do not think about the chairman of the meeting that is a different concept.
5) Can a non executive director become chairman in a meeting, and wat about independent director.
6) Why clause 49 says that there should be 50% non executive director in Board, what is the benefit.?
7) Can a person be executive director in more than one company, take the case of pvt. as well as public co.
8) Additional director will always be an executice director. Is it true?
9) when we will regularise the additional director in AGM, so whether we should go for form 32 again.

Please give the professional answer.

Thanks n Regards,

karan gandhi

Replies (5)

Ankur Garg

Company Secretary and Compliance Officer

114788 Points Joined January 2009

Hi,

Kindly observe the below mentioned points:

1. Normally MD/WTD and a director drawing salary are considered as executive director.

2. For MD there is no need to check pay roll. MD is always executive director because as per law he is in charge of whole or substantially the whole powers of management.

3. As per section 269 if paid up capital of the public company is more than 5 crore then appointment of MD, WTD or manager is necessary. You may appoint any one to fulfill requirement. Section 269 is not applicable on a private company.

4. Chairman concept is also there in companies act, 1956. As per my understanding chairman is a administrative term as well as a legal term. Please refer any good law book.

5. A non executive director or independent director can become chairman in a meeting. There is no restriction at all in law.

6. Intention of STX would be to introduce greater transparency in the board matters with the help of independent directors.

7. Yes. A person can be a executive director in more than one company. For example section 316 allow a person to be MD of more than 1 company.

8. No additional director is not executive director automatically. However if you appoint additional director as MD then you can consider him as executive director.

9. YES. On regularisation of additional director in the AGM form-32 is required to be filed with ROC with in 30 days of AGM.

Hope the above discussion would be off some help. Revert for further clarification.

Best Regards

Ankur Garg

Company Secretary and Compliance Officer

114788 Points Joined January 2009

Kindly visit the following 3 useful links regarding your query:

Appointment of Managerial Personnel Analysis Part-I

Appointment of Managerial Personnel Analysis Part-II

Regularisation of Additional Director

Punit Tibrewal

student

1684 Points Joined May 2009

ankur ji u always rock..!

Guest

4) In clause 49 of listing agreement you will find the chairman concept, who is chairman of company, is it a administrative term or legal term, do not think about the chairman of the meeting that is a different concept.

MD is the person who handles the affairs of the company.

While Chairman is the person who handles the affiars in the Meetings.

Only Director can be the Chairman.

7) Can a person be executive director in more than one company, take the case of pvt. as well as public co.

Yes, a person can be executive director in more than 1 company. He can become the Executive Director of 20 company (Clause 277) Excluding the Private Companies.

8) Additional director will always be an executice director. Is it true?

He can be any one i.e. Executive Director or Non-Executive Director.

It depends on the company, How the company wants to get benefit from the Director?