vijay krishna narala (Company secretary) (47 Points)
02 February 2010Dear Professional frienends,
whether Board can appoint the M.D/ Director with retrospecttive effect by ratifying the appointment? it means the M.D/Director is appointed by the Board but with retrospective effect.
Please guide me in this regard.
Aman Jain
(Company Secretary in Practice)
(165 Points)
Replied 02 February 2010
vijay krishna narala
(Company secretary)
(47 Points)
Replied 02 February 2010
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 02 February 2010
Hello,
No your Board cannot appoint the M.D/ Director with retrospective effect by ratifying the appointment. Reason behind this interpretation is proviso to sub section (3) of section 317.
By virtue of proviso to sub section (3) of section 317 law allows you to re-appoint managerial personnel well in advance before the expiry of his/her term. If you failed to use this relaxation then law can’t help it.
Best Regards
Aman Jain
(Company Secretary in Practice)
(165 Points)
Replied 02 February 2010
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 02 February 2010
Dear Vijay,
Re-appointment of MD/ WTD must be made well in advance i.e. before the eqpiry of his tenure.
However, as per your query the tenure of the MD has been ended in the first week of January, 2010 but the BM was held only at the last week of January, 2010. So if the tenure of the MD is over how he worked under the capacity of MD, Form 32 (for change in directorship) must be filed within 30 days and when the reappointment is made new form 32 (for reappointment of MD) is required to be filed within 30 days.
So the reappointment must be made well in advance.
CAclubindia
