Appoinment of MD of Pvt. Ltd.,
This query is : Resolved
07 January 2011
I am a share holder and director of the co.
is it a satutory requirement to have agreement for MD of the company
is it a satutory requirement to have agreement for MD of the company
07 January 2011
There is no statutory requirement to have an agreement with MD of the Company.
MD can be appointed by a resolution passed by the Board intially and later approved by members in the general meeting. He may be issued an appointment letter like any other employee of the Company.
MD can be appointed by a resolution passed by the Board intially and later approved by members in the general meeting. He may be issued an appointment letter like any other employee of the Company.
Message likes :
1 times
07 January 2011
Hi
Generally the provisions of appointment and remuneration of MD/WTD in a private limited company is govern by their articles, because the provisions of Companies Act, 1956 will not applicable. But as a good corporate practice you can follow the procedure applicable to public limited company for such appointment.
PROCEDURE FOR APPOINTMENT OF WTD/MANAGING DIRECTOR
1. Aboard Meeting shall be convened to decide on the proposal to appoint a particular person as a managing director and also decide provisionally the terms and conditions of the appointment including the remuneration if any, payable to the managing director.
2. The Board decide whether the remuneration payable to MD would be by way of monthly payment or at a specified percentage of the net profit of the company or partly by the one way or partly by the other.
3. A copy of the Board Resolution regarding the appointment should be filed with the ROC in Form-23 within 30 days from the date of passing of such resolution.{ Section 192(1) read with Section 195(4)(c)}.
4. If the appointment is in conformity with the provision of Schedule XIII, a return in Form-25 C must be filed with in 90 days from the appointment with ROC.
5. The appointment and remuneration payable to MD require approval of the Shareholders by Ordinary Resolution.{Clause I of Part III of Schedule XIII}.
6. The terms and conditions of the appointment of MD should be incorporated in an agreement executed by him with the company.
7. An abstract of the terms of agreement for the appointment of the MD should be sent to every member of the company within 21 days of entering into agreement.
Best Regards
Generally the provisions of appointment and remuneration of MD/WTD in a private limited company is govern by their articles, because the provisions of Companies Act, 1956 will not applicable. But as a good corporate practice you can follow the procedure applicable to public limited company for such appointment.
PROCEDURE FOR APPOINTMENT OF WTD/MANAGING DIRECTOR
1. Aboard Meeting shall be convened to decide on the proposal to appoint a particular person as a managing director and also decide provisionally the terms and conditions of the appointment including the remuneration if any, payable to the managing director.
2. The Board decide whether the remuneration payable to MD would be by way of monthly payment or at a specified percentage of the net profit of the company or partly by the one way or partly by the other.
3. A copy of the Board Resolution regarding the appointment should be filed with the ROC in Form-23 within 30 days from the date of passing of such resolution.{ Section 192(1) read with Section 195(4)(c)}.
4. If the appointment is in conformity with the provision of Schedule XIII, a return in Form-25 C must be filed with in 90 days from the appointment with ROC.
5. The appointment and remuneration payable to MD require approval of the Shareholders by Ordinary Resolution.{Clause I of Part III of Schedule XIII}.
6. The terms and conditions of the appointment of MD should be incorporated in an agreement executed by him with the company.
7. An abstract of the terms of agreement for the appointment of the MD should be sent to every member of the company within 21 days of entering into agreement.
Best Regards
Message likes :
1 times
07 January 2011
Thank you both
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- ITC temporary reversal and reclaim
- Inventory of finished goods
- Applicable TDS rate for sale of property in Nov 2024
- RCM INVOICING FROM NOV-2024
- Confusion around Form 26QB fields
- Sale of property furniture sale
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- Quiery in relation to GST liability in case of an advocate who has obtained GST registration.
- Can we claim ITC of Feb-2024 in the month of November-2024 which was not claimed by oversight
- TDS under section and rate of TDS
- GST input on scooter purchased
- TDS under section 194Q and TCS under section 206C
- GST input on car insurance and repairs
- GST input on Diwali gift to employee
- GST input on Mobile Handset
- Material and freight in same invoice
- TDS under section 194J inclusive of reimbursement of expenses
- TDS on Material and Labour in same invoice
- Should I be worried about and rectify reporting Jan,Feb ,March 2024 foreign salary in schedule FA?
Trending Online Classes
CAclubindia
