Re-appointment of MD

As per sec-317 of Co's Act - A MD or Manager can be appointed for 5 yr only ,however it can be extended by reappointment for further 5 yrs. but this reappointment shouldn't before 2 yr of his expiry of term.

in yr given case,after 2 yr of appointment by passing resolution his period of appointment is extended for further 5 yr.

I think this is contradiction of sec-317.this resolution is as reappointment of him as a MD for further 5 yr ,but this reappointment is before 2 yr of his expiry of term

hence this resolution shall be void ab initio.

But Amit if the terms are changed with respect to change in remuneration.. will it still be called a violation??

on which ground as the terms are changed for remuneration and then increase in term??

Dear Deepak , In given case not mere term of remunaration is changed but it results in further extension of MD appointing period beyond 5 yr from his 1st appointment.

therefore it is voilation of Sec-317 .I think u understood resolution passed for extention of MD remuneration only , which is not in consonance with given case by Mr. AAshish.

Amit,

What if along with the change in remuneration as conceived y deepak, i also pass the resolution fixing new tenure of the MD.

Also, pls advise is there any similar restriction on WTD.

rgds,

Ashish

Dear Ashish

 Sec-317 is applicable on MD & Manager only and not on WTD.Ie. WTD can be appointed for more than 5 Yr. tenure, Whether it may be by Passing resolution Extention or fixing at the first time appointment.

Yr 2nd Q's Ans is  : Remuneration can be changed by Passing resolution considering there related limitations.(Sec-198,309,387& shedulexiii.

  But Resolution should not results in extention of his appointing tenure beyond 5 Yr. from his 1st appointment.