MD Vs. WTD

Hello,

there is no specific difference given in act b/w Md and wtd. further as u said in sec 316 there is a restriction on appointment for a md but there is no such restriction on WTD in co act and that can b supported by just logical reason that a person can not be present in more then one co as a whole time employee.

Regards

Dear Friend

The Companies Act 1956 does not obviously indicate the position of Whole-time Director (WTD) very clearly, at least to the extent it does in the case of a Managing director (MD) or Manager who have been defined in Definitions section.

Of course there is an explanation under 269(12) which says " WTD includes a director who is in the whole-time employment of a company", suggesting that a WD can also be one who is not in the whole-time employment of the company!

Then if we look at section 269(1) containing the words " a public company (with prescibed share capital) shall have a managing or whole-time director as if suggesting that MD and WTD are synonimous. 269(2) refers to the appointment of "managing or whole-time director" in accordance with Sch XIII.

PartI(d) of that schedule says "where he is a managerial person (which includes MD, WTD, director or Manager in more than one company "... etc., suggesting that WTD can also be in more than one company!

It is strange, however, that a MD can not be so in more than two companies because of section 316, and such restriction seems to be there in the case of WTD!

Regards

CS Ajay Mishra

Hello Sir,

For Md and manager specific sections(Sec 316 and Sec 386) are given for no. of co. in which they can be md or managers. But no specific section is given for whole time directors so that can not be assume that a wtd can also be appointed in two co. 

Plz throw some light on that.

Waiting for clarification

Regards

Whether the term WTD has not ben defined under the act, but by analysing provisions following differences can be drawn:-

Regards,

Thank you all for suggestions. I could do good analysis of the difference and by reading and interpretation of law and of course by variuos articles on google , there seems some 4 -5 diff. between the same which is posted by me as a file. request u to have ur views on the same. 

However for Mr. Vivek,

The difference which you have highligheted is taken from Google book which is already found by me in one of the books by just doing google search. However, i have interepreted all those differences which are provided in the book.

I suppose regarding appointment of Md, there is no provision that he must be appointed in general meeting cause 2(26) says that he can be entrusted with powers of MD either by 5 ways which are in GM, in BM, by agreement etc. but, as per part III of sch.XIII it is mandatory to pass resolution in GM for decd remuneration of MD. Since, in most of the companies MDs are appointed with remuneration, resolution becomes necessary. further, listing agreement says to discluase all conditions on which managerial personnel is appointed. thus, better to disclose to the shareholders. but, my question is then, if any co. appoints MD without salary / remuneration / commission, is it ok if it just passes resolution in General meeting?

I agree with Mukti Raval..even i have the same confusion...and if u see the point of Difference No.2..it says appointemt of M.D dosent require shareholders consent..is it??

As per section 269 of the Companies Act, 1956, you can appoint MD by two way either by CG approval or by Schedule XIII. If you appoint MD by Schedule XIII it says that the appointment will be approved by Special Resolution at shareholders meeting.

For shareholder approval, there is no need to call a general meeting for such appointment. You can take this agenda item on any general meeting to be held after appointment.

Regards

ok. I think this clears the doubt. Thank you All.

Thanks for good dixussion.

Yogesh