20 August 2007
In a Government Unlisted Subsidiary Company, the Managing Director is also the Director in the holding company as per the Articles of the Company.The Managing Director is governed my the term and conditions of employment placed for consideration in the Board Meeting of the subsidiary company as per the government company employment rules.In that,there is a certain perquisite,which the MD is not entitled to. But,as per the approval in the holding company, the Managing Directors of the Subsidiary are entitled to that perquisite. Now the question is, which one should be applicable and supersede the rules and why?
21 August 2007
Resolutions passed by the holding company are not ipso facto binding on the subsidiary company . Normally the subsidiary is supposed to ratify the decisions , for the simple reason that holding company is having more voting rights . So answere to your question depends on language of the resolution of holding company and whether it was adopted by the subsidiary company or not???
CAclubindia
