02 February 2011
A company(listed entity) wishes to appoint Mr. X as additional Director and Whole-Time Director.
-The Board appointed him as Additional Director and subject to shareholders confirmation simultaneously appointed him as WTD.
-Now the company wishes to confirm his appointment as WTD before paying him renumeration.
-So The company takes the approval of the shareholders by postal ballot.
-Now my question is conclusion of AGM shall automatically bring an end to the office of Additional Director
-As a act says that WTD is a DIRECTOR of the company who is in whole time employment of the company,Should the company pass a resolution for confirmation of Mr x as Director of the company in the AGM because as he vacates the office of Additional director he defies the definition of WTD??
-According to me Mr. X should be confirmed as Director but i cant find any direct impling section to prove my point to my seniors.Please site some example/empowering section-case law that helps me prove my point.
-In case I m wrong , Please tell me the right method of implementing the above..
02 February 2011
My Understanding of your query is - 1) A Director is appointed as Additional director (WTD) and 2) His appointment as WTD is approved by postal ballot prior to AGM Date.
So my answer to your query is -
- If the resolution for appointing additional director as wholetime director is passed through postal ballot before the AGM, then there is no need to again regularise him in AGM.
As per Section 192A(4) if a resolution is assented to by a requisite majority of the shareholders by means of postal ballot, it shall be deemed to have been duly passed at a general meeting convened in that behalf.
Since the appointment as WTD is confirmed through the postal ballot before the AGM, he will not be an additional director as on the date of AGM.
CAclubindia
