Disclosure of director's interest - s 184(1)

Co Act 2013 1038 views 3 replies

panakx

Student

171 Points Joined August 2013

I recently came across Section 184(1)- Disclosure of Director's Interest of Companies Act 2013 wrt MBP1/MGT 14. As per the section, directors of a particular company are required to disclouse their interest to the Board in companies/firms/association of individuals along with shareholding % as per the MBP 1 format.

Now coming to my doubt, is it mandatory for directors to disclose their holding even in companies in which they are not directors? Will it not mean that even equity shares held for trading purpose, howsoever minute they may be in % terms, will be required to be disclosed in MBP 1 to the Board?

Replies (3)

CS Mitesh Mehta

Company Secretary

17139 Points Joined January 2009

YES

As per Section 184 of the Companies Act, 2013, every director of the Company shall disclose his concern or interest in any Company or Companies or Bodies Corporate (including shareholding interest), Firms or other Association of Individuals, by giving a notice in writing in Form MBP 1 pursuant to Section 184 (1) and rule 9(1) of Companies (Meetings of Board and its Powers) Rules, 2014.

CS MOHIT SALUJA

PRACTICING CS Jalandhar 9914558709

5155 Points Joined April 2010

The related section puts a burson over the directors everytime their interest changes. The reading of section says that even if the directors have invested in the shares for trading purpose, they need to disclsoe the same to the company. Moreover every time whenever their interest change, they need to disclsoe the same and the board is to take note of the ame in the next board meeting to be held after the disclosure is being given by the directors.

It was expected that such compliance will be removed from the prview of private limited companies after amendments in Companeis Bills to be passed by parliamnet. but no such initiative had been taken by the government/ MCA in this regard in december session and still the same need to be filed by directors to the company.

Ajay Kumar Maggidi

Manager - Finance & Accounts

2073 Points Joined December 2012

Originally posted by : CS Mitesh Mehta
	YES As per Section 184 of the Companies Act, 2013, every director of the Company shall disclose his concern or interest in any Company or Companies or Bodies Corporate (including shareholding interest), Firms or other Association of Individuals, by giving a notice in writing in Form MBP 1 pursuant to Section 184 (1) and rule 9(1) of Companies (Meetings of Board and its Powers) Rules, 2014.

dear sir.

Mere holding concern or interesr in any body corporate/firm/association of individuals need to be disclosed by the director ,though not entering into any contracts or arrangements with them,at times as prescribed in the act?

Thanks In Advance.