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appointment of MD

DIPAK AGARWAL (Service) (554 Points)

11 December 2008

What is the procedure of Appointing a fresh person as a Managing Director of a Public limited co. & what forms are to be filed with ROC.

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17 Replies

Pavan Jain S (Chartered Accountant) (1575 Points)
Replied 12 December 2008

A Company can appoint a MD by passing a ordinary resolution at the GM unless the AOA requires special resolution. A MD can be appointed by the BOD of the Company, if authorised..

Appointment of MD of a public Company must be in compliance with section 269 r.w. sch XIII of the Companies Act. Else, CG approval is required

A Company need to file Form No. 25C within a period of 90 days from the date of appointment if the appointment is in accordance with Sch XIII. Also Form No 28 has to be filed within 30 days from the date of appointment.

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DIPAK AGARWAL (Service) (554 Points)
Replied 22 December 2008

Mr. Pavan Jain

You have mentioned form - 28 to be filed, but there is no such form. whether this is form-23 to be filed?

Secondly you have not mentioned about form 32, whether the same is to be filed after board meeting or EGM?

CS Arpita Rajpurohit (Company Secretary) (1111 Points)
Replied 22 December 2008

Form 25C & 32 for aapointment of M.D.

F-23....only if app. is made by special res.

CS P K Pandey (employed) (97 Points)
Replied 23 December 2008

Forms required to be filed

1. 32 to make him director,

2. 23 to file resolution, who told that only special resolutions are filed in23,

3. 25c

only a director can be MD, otherwise that person will be called manager.

CS Diwaker Agrawal (COMPANY SECRETARY) (167 Points)
Replied 24 December 2008

hi dear

There are two ways to appoint MD/WTD.

1. Comply schedule XIII i.e. remuneration should be within the limits of section II of the schedule and director should not be disqualified under section I . For this purpose following forms required to be filed -

Form 32

Form 23 for board resolution appointing MD

Form 25C within 90 days of the appointment

2. Second way take the approval from. No need to comply schedule XIII. In this case the co can give remuneration beyond the limits specified in XIII. Form to be filed -

Form 32

Form 23 for board resolution appointing MD

Form 25A within 90 days from the appointment

Regards

Diwaker Agrawal

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DIPAK AGARWAL (Service) (554 Points)
Replied 24 December 2008

Diwakerji,

Is this also a right way to appoint a new /fresh person as MD (without remuneration) in a public ltd. co.

1) Appoint him as Addl. Director in Board meeting & file form 32

2) Appoint him again in next board meeting as MD. & file form 32 for change in designation.

3) Approal of Members are to be taken in EGM for appointing him as MD & file the resolution by form-23

4) then file the form 25C within 90 days from the date of 2nd board meeting in which he was made MD.

pl. suggest that any thing wrong in this procedure?

Dipak Agarwal

CS Diwaker Agrawal (COMPANY SECRETARY) (167 Points)
Replied 24 December 2008

hi deepak

In my view ur procedure to appoint the MD is correct. But u r not required to hold two BM but u can appoint him first as additional director and then as MD in same meeting by passing two Board resolutions.

Further u r also not required to hold EGM since u can wait upto AGM and can take shareholder approval in AGM

Contrary views are solicited.

Regards

Diwaker Agrawal

Preety (Company Secretary) (96 Points)
Replied 07 June 2010

Hello friends

Mine is a listed Co. We want to appoint MD of the Company and designate him as CEO of the Company . But the Co does not want to pay any remuneration to him. Can the Co appoint him as MD without paying Remuneration to him. If yes , pl provide me the resolution for the same.

Also what would be effective date of apppt - whether date of BM or date of AGM where appt is approved.Form 25 C would be filed within 90 days of BM or AGM.Pl treat it as urgent

Thanks in advance

Preety

Mitali Agarwal (Company Secretary) (638 Points)
Replied 07 June 2010

A company can appoint MD without remuneration. (but it sounds strange that MD bein designated as CEO is not drawing any remuneration).

Form 25C is to be filed within 90 days from the effective date of appointment as mentioned in the resolution passed in the earlier meeting. i.e. Board Meeting.

Mitali Agarwal (Company Secretary) (638 Points)
Replied 07 June 2010

BOARD RESOLUTION FOR APPOINTMENT OF MD:

Resolved That pursuant to the provisions of Section 198, 269, 309, 311 read with Schedule XIII and other applicable provisions of the Companies Act, 1956 and subject to the approval of the members of the Company in the General Meeting, Mr. _______________, be and is hereby appointed as the Managing Director of the Company for a period of 5 years effective from _______________, on the terms and conditions, draft whereof was placed before the Board and initialed by the Chairman for the purpose of identification.

Resolved Further That Mr. _____________, Director of the Company be and is hereby further authorized to file the prescribed forms in this connection with the Registrar of Companies.

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Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 07 June 2010

Dear Friend,

Please find enclosed herewith a useful file containing provisions for the appointment of Managerial Personnels.

Hope this file would be of some help.

Revert if there is any doubt.

Attached File : 26 appointment of managerial personnel.pdf downloaded: 226 times

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 07 June 2010

Check the below articles:

APPOINTMENT OF MANAGERIAL PERSONNEL ANALYSIS PART-I

APPOINTMENT OF MANAGERIAL PERSONNEL ANALYSIS PART-II

Ashish Gupta (CS & Legal) (114 Points)
Replied 07 June 2010

Please note that everytime company pass a resolution for appointment/renewal of appointment/change in terms of MD, it needs to file Form 23 with ROC, as per Section 192(4)(c) of the Companies Act, 1956.

Mitali Agarwal (Company Secretary) (638 Points)
Replied 07 June 2010

But i don't think so that when board resolution for appointment of MD is confirmed in the general meeting, then Form 23 is to be filed as there are no changes in the terms and conditions of appoint..

Views of learned members are solicited.