Applicability and interpretation

Pvt ltd 638 views 2 replies

S K Jain

Service

41 Points Joined May 2008

Dear All,

I have certain peculiar/interesting queries with respect toPrivate Limtied Co

1) Articles provide that directors can be appointed by the parent company. In addition to this clause the articles also provides that Board can appoint alternate, Additional and Directors in casual vacancy.

Assume the articles read as follows-

X) i) The First Directors of the Company are.............

ii) Any other directors can be appointed by Parent company, on such terms and conditions and such period

Y) Power to the board to appoint Alternate, Additional and casual vacancy

Query: If any director is nominated by Parent Company under X(ii) and the appointment is noted by Board, does he still needs to be reconfirmed/appointed in the next AGM. Can the powers be given to shareholders for such appointemnts and still not routed through AGM. On reading 255(2) i guess he needs to be reappointed.

2) Validity of the directors disclosure taken in January every year under section 299. Is the Company voilating the provisions

3)Can the manager be appointed only for Digital signatures and his name reflected in MCA Website?

4) Is the Company not complying with the provisions of Act, if the shift of reg office is intimated but the ROC does not change its record

5) Procedure to remove the name of manager from the portal, for which DIN3 is filed but no Form 32 is filed

Please reply.

Replies (2)

P C Agrawal

Registered independent director Past Ch

8229 Points Joined March 2007

1) Cos Act does not provide for nomination of directors by companies and hence any provision in the Articles in this regard is void. Only financial institutions have right to nominate directors pursuant to provisions contained in their respective Acts which supersede Cos. Act. In other cases, it is only Board or shareholders who can appoint directors.

2) Disclosures by directors : Pl refer Sec.299(3)(b). Disclosures expire at the end of financial year.

3) "Manager" under Cos. Act acquires whole or substantially whole of powers of management. He will be responsible for activities of the company and can be prosecuted in case of default. Considering this, you can appoint.

4) You have to specify where you have shifted your registered office - within the city, State or outside State.

5) Name will appear in the list of authorised signatories only when you file form 32 for his appointment.

Thanks

S K Jain

Service

41 Points Joined May 2008

Dear Mr. Agarwal, thanks for your inputs, will the position change if the Company is private Company and the articles provide that Shareholders(parent company) can appoint director. Section 255(2) provides for inclusion of such points in Articles