Stop Directors to using Company Funds

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

05 July 2010 I have some funds in my company & i do not want that any director use this funds for personal purpose because this fund is the life of the company & company is making its income from the said fund so please tell what can i do in this matter.

CA.Mini

CA.Mini (Expert)
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05 July 2010 i dont understand how the companys funds can be applied for personal purposes by the directors without the consent of other members in the company.if you r a member of the company then make a representation to the company regarding your intention of the application of funds and circulate with the notice of the meeting and read out the representation in the meeting take the consent of the quorum in the meeting . decide and act accordingly.

Ankur Garg

Ankur Garg (Expert)
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06 July 2010 Agree with expert.

Company's funds can not be used by directors for personal purposes and are only for company's business purposes.

You may remove such director by passing an ordinary resolution of shareholders in the general meeting u/s 284.

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Querist : Anonymous

Querist : Anonymous (Querist)

06 July 2010 I am agree with you. but i am Resigning form the board of Directors & i want that the new director will not use this funds for other purpose so i want to pass an special resolution that the fund will be invested in Govt. bank FD & no director can take Loan on FD & this fund will be withdraws when Interest become @ 3% in FD . Can i do this or this Resolution will be passed in the board of directors meeting.

CA.Mini

CA.Mini (Expert)
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06 July 2010 resolution has to be passed because a director cannot unanimously take decision regarding the investment of funds.hold an egm and place the representation before the members.