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Md reappoitment

deepali agarwal (Company Secretary) (1289 Points)

02 May 2013

Mr. MD's 5 years appointment is to expire on 3rd May 2013 and next AGM is to be held on 13th August 2013. Company wants to reappoint him as MD for another 5 years.

What will be the procedure for reappointment along with it compliance under the Companies Act, 1956.

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10 Replies

Deepak Dargad (Chartered Accountant....) (9787 Points)
Replied 02 May 2013

See this link its useful to you

/experts/reappointment-of-managing-director-505130.asp

1 Like

deepali agarwal (Company Secretary) (1289 Points)
Replied 02 May 2013

But in my case AGM is on 13th August,2013 and expiry of his term is 3rd MAy 2013..Then whats the remedy to avoid penalty ??

Deepak Dargad (Chartered Accountant....) (9787 Points)
Replied 02 May 2013

https://www.lawyersclubindia.com/forum/Re-appointment-of-Managing-director-Unlisted-public-company-17505.asp#.UYJTS0pj_aQ

See this

deepali agarwal (Company Secretary) (1289 Points)
Replied 02 May 2013

Ya but in this consent of shareholders in required in AGM and that is to be held on 13th August i.e after expiry of his term so wudnt he suffer with penalty???

Deepak Dargad (Chartered Accountant....) (9787 Points)
Replied 02 May 2013

Pass board resolution and thn in nxt GM get aprroval of shareholders

this is my thinking

thn i dont think penalty vl be applicable

1 Like

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 02 May 2013

Dear friend,

Re-appointment of Managing Director in a public company can be done by board meeting resolution subject to the approval of shareholders in a General Meeting.

For example if the term of your Managing Director expires on 31.03.2010 there is no need to worry at all. Simply pass a board resolution before 31.03.2010 subject to the approval of members in the general meeting and confirm the appointment in next General Meeting held immediately after his/her appointment by the board.

File all the necessary ROC forms from the date of board resolution. Nothing is to be filed after General Meeting for confirmation as far as re-appointment of Managing Director is concerned.

Remember one thing retrospective re-appointment of Managing Director is not possible due to section 317 hence passing of Board Resolution subject to the approval of members before 31.03.2010 is mandatory.

As per DCA clarification the above practice is very much possible. Find below the extract of DCA clarification:

As per circular number 2/94 dated 10 February 1994— Managing Director may initially be appointed by a board resolution subject to the approval of members in the general meeting and such approval may be obtained in the first general meeting of the company held immediately after his appointment by the board.

E-form filing with ROC:

1. Form-25C/25A, as the case may be, under section 269 within 90 days from the date of passing of board resolution.

2. Form-23 under section 192(4)(c) within 30 days of passing board resolution.

Form-32 is not required in case of re-appointment of Managing Director as there is no change composition in board of directors involved.

Best Regards

1 Like

deepali agarwal (Company Secretary) (1289 Points)
Replied 02 May 2013

Ya but in every Provision relating to it the main requirement is passing of board resolution in addition to consent of shareholders in general meeting...So do u think this wud be the appropriate remedy???