Section 257 of the companies act.

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CA (Final) Salem. Tamilnadu. sssvksridh
218 Points Joined May 2011

 

Section 257 of the Companies Act, 1956 reads as follow

 

257. RIGHT OF PERSONS OTHER THAN RETIRING DIRECTORS TO STAND FOR DIRECTORSHIP.

 

A person who is not a retiring director shall, subject to the provisions of this Act, be eligible for appointment to the office of director at any general meeting, if he or some member intending to propose him has, not less than fourteen days before the meeting, left at the office of the company a notice in writing under his hand signifying his candidature for the office of director or the intention of such member to propose him as· a candidate for that office, as the case may be along with a deposit of five hundred rupees which shall be refunded to such person or, as the case may be, to such member, if the person succeeds in getting elected as a director.

 

 

 

…, if he (=such person) or some member intending to propose him has left at the office of the company a notice…

 

The above said notice should be left at the office of the company either by such person or some member. No doubt.

 

…a notice in writing under his (=such person’s) hand signifying his candidature for the office of director or the intention of such member to propose him as a candidate for that office….

 

Under whose hand should the notice be in writing? Whether under such person’s hand or under such member’s hand? – I can not understand.

 

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On 24 April 2012 at 15:50 Report
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Team Lead
7558 Points Joined November 2011

It means that  the if a person intends himself to be appointed as an director then he himself has to give a notice to the co, or if some other person proposes such other person to be appointed as a director of the co then such other person can leave a notice at the co's office before 14 days of the GM of teh co i.e

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On 24 April 2012 at 15:58
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CA (Final) Salem. Tamilnadu. sssvksridh
218 Points Joined May 2011

Okay, Giridhar S Karandikar. Suppose Mr. A is a member of a company and Mr. C is a non-member of the company. Now Mr. A wants Mr. C to be appointed a a director of the company and Mr. A, as you explained, leaves a notice in writing under his hand at the office of the company. How can the company know whether Mr. A has left the notice with the consent of Mr. C or without the consent of Mr. C? Is it confusing? 

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On 24 April 2012 at 16:13
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ACS
453 Points Joined May 2011

On receipt of letter from Mr. A, proposing the candidature of Mr. C as director. The Company shall inform Mr. C of the same.  

Mr. C himself has to give his consent to be appointed as director or not.

 

Practically, in small companies, both the parties are related, like designated employee, director, CEO, CFO, etc,. etc....so the consent comes within his knowledge. 

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On 24 April 2012 at 16:25
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Company Secretary and Compliance Officer
114788 Points Joined January 2009
Originally posted by : sssvkSridharan R.

Okay, Giridhar S Karandikar. Suppose Mr. A is a member of a company and Mr. C is a non-member of the company. Now Mr. A wants Mr. C to be appointed a a director of the company and Mr. A, as you explained, leaves a notice in writing under his hand at the office of the company. How can the company know whether Mr. A has left the notice with the consent of Mr. C or without the consent of Mr. C? Is it confusing? 

 

Please do not confuse. It is not a big deal obviously. Company can straight away ask Mr. A to verify the details of Mr. C, candidate of Directorship.

 

Alternatively company can definitely ask Mr. A to submit a consent letter duly signed by Mr. C to act as director of the company. Asking for such consent letter doesn’t mean that company is denying the advantage of Section 257 to anyone. Further it is in the best corporate practice.

 

Thanks

 

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On 24 April 2012 at 17:39
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ACS
453 Points Joined May 2011

Aptly put Ankur Sir. 

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On 25 April 2012 at 09:30
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Tax Consultant
1596 Points Joined February 2009

U/s 257 of the Companies Act 1956 : Notice is received from a member proposing himself for appointment of director is valid , even if it is received after despatch of notice of AGM but atleast 14 days before the AGM.

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On 25 April 2012 at 10:38
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na
21 Points Joined April 2012

 

X , who is not a shareholder in a company sent a notice to the company, sent a notice to the
company of his candidature for the office of director in the place of a retiring director at the
ensuring annual general meeting of the company. The same company received another notice
from Y, a member, holding only one share signifying his intention to propose the candidate of Z
for the office of director in place of retiring director. As a secretary of the company how will you
deal with this notice ? can any member present at meeting propose the aforementioned proposals
for the consideration at the meeting?
 
Plz reply its for a college assignment for my final MBA
 
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On 27 April 2012 at 23:16


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