Appt. of MD

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 December 2010 Section 269 provides that the Co. having a paid-up share capital of more than 5 crores is required to appoint a MD...But what is the time frame within which the MD is to be apptd. after the increase in Paid-up capital.

Actually the paid-up cap. of my dompnay is increased to more than 5 crores w.e.f. 09/11/2010....so can i appt the MD in the forthcoming AGM (in the 2nd week of August) or do i need to appoint before that...pls. suggest.

Jayashree S Iyer

Jayashree S Iyer (Expert)
Follow

27 December 2010 Once the company's paid up capital crosses the limit of Rs.5 Crores, it attracts section 269. So the Board must appoint MD as soon as it crosses the limit subject to approval of members in the General Meeting.

udit sharma

udit sharma (Expert)
Follow

27 December 2010 Hi...

To the best of my knowledge there is no time limit prescribed as to within which the MD has to be appointed in case there is an increase in the share capital of the Company to the limits prescribed under section 269 of the Companies Act, 1956.

But in my opinion, u can convene an Board Meeting after 09/11/2010 say on 20/11/2010 and appoint an Additional Director as MD. You can also appoint an existing Director as MD of the Company.
In case ur Board wants to appoint an Additional Director follow the procedure as under:

1. Convene a BM and pass a resolution for appointment of AD to hold the office as such till the date of next AGM,

2. Then pass another resolution appointing him as a MD subject to the consent of the members in the GM.

3. File Form 32 within 30 days from the date of appointment of AD,

4. File Form 23 within 30 days from the date of appointment of Additional Director as MD,

In the AGM, obtain the consent of the members first to regularize the Additional Director and then obtain their consent to the appointment of MD w.e.f. date of BM in which he was appointed as such.

GOD BLESS

UDIT SHARMA

Upgrade to CAclubindia Pro. Subscribe Now!