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Appointment of director in casual vacancy in pvt. ltd.

Gargi Ranade (CS) (410 Points)

03 November 2016

Dear all,

I am working in the Pvt. Co. , after the commencement of Companies Act 2013, first time one of the director resigned . Now, Articles of Asociation of the Company permits the BOD to fill up the casual vecancy . However , Section 161(4) specifically talks about the filling up of the Casual vecancy through BM by Public Co & Pvt. co. which subsidiary to Public co.

this provision is similar to section 262 Companies Act,1956. In book written by Sanjiv Agarwal Sir on Companies Act 1956, it has been mentioned that It does not bar Pvt. Co. to filling of casual vecancy by Board of Directors if Articles of the Company specifically permits for the same.

Please guide me, can I appoint the director in Casual Vecancy through BM or I need to Call up EGM for the same.

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2 Replies

P C Agrawal (Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad) (8229 Points)
Replied 03 November 2016

Sec.161(4) as it stands today is applicable only in case of public company and therefore you need to convene EGM to fill casual vacancy. However, vide Companies (Amendment) Bill 2016 the words "In the case of a public company" in the section are proposed to be omitted, after passing of which the provision will apply in private company also.

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CS Subbarao (CS) (40 Points)
Replied 06 November 2016

Dear Gargi

No need to conduct EGM to appoint director for a casual vacancy. You can appoint thorugh Board Meeting to fill casual vacancy even it is mentioned in the act for Pvt ltd company. It is not barring PVT ltd companies appointing though BM.

Thanks & Kind Regards

K.V.Subba Rao