A,B,C directors in A ltd ,are holding 1.0%, 0.6% ,0.2% share respectively in Bltd: advice whether A,B,C will be considered as interested director or not u/s 299 when
-spouse of A is holding 0.2% inBltd
-spouse of A is holding 10% share in Bltd.
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pls answer
Replies (3)
Hi
No director will be considered as interested in B Ltd. under section 299.
Section 299(6)says all directors togather holsds more than 2% of the share capital for being interested.
Other views are also solicited.
Regards
But as per MCA clarification on sec 299(1), a director can be considered interested if his personal interest is in conflict with the interest of the company or the interest of his relative is inconflict with the interest of the company.
299. Disclosure of interest by director.—
(1) Every director of a company who is in any way, whether directly or indirectly, concerned or interested in a contract or arrangement, or proposed contract or arrangement, entered into or to be entered into, by or on behalf of the company, shall disclose1 the nature of his concern or interest at a meeting of the Board of directors.
(6) Nothing in this section shall apply to any contract or arrangement entered into or to be entered into between two companies where any of the directors of the one company or two or more of them together holds or hold not more than two per cent of the paid-up share capital in the other company.
From the above provision it is clear that A, B and C are not intrested Director as they not hold directly or indirectly more than 2% of the paid up share capital in other company.
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