Still Learning (cs) (234 Points)
03 December 2013Ours is a private company that seeks to appoint an Managing Director.My question is should the tenure of appointment and remuneration be mentioned in the resolution?Is it necessry to mention it or can we leave it open ended.Also the terms and conditions should be a partof the resolution or will it be a separate agreement/Annexure to the resolution?
If possible please provide a specimen resolution.
CS BHAVIN SHETH
(MANAGER-Company Secretary)
(131 Points)
Replied 04 December 2013
Dear Sayali,
please see the below mentioned resolution format for your refrence,
RESOLVED THAT pursuant to section 269 and other applicable provisions of the Companies Act, 1956 and subject to the approval of shareholders at the General Meeting, this meeting approves the appointment of Mr. _______________ as Managing Director of the Company on the terms and conditions set out in the agreement dated the ____________, 200___ (a copy of which tabled at the meeting being authenticated under the signature of the Chairman hereof for the purpose of identification) for a period of five years with effect from the _____________, 200___
RESOLVED FURTHER THAT an Extraordinary General Meeting be held on ____ at ___________________ at ____A.M. to get the approval of the members to the proposed appointment.
RESOLVED FURTHER THAT a draft of the resolution together with the explanatory statement, a draft of which is tabled before the meeting be included in the notice to be issued for convening of Extra Ordinary General Meeting.
RESOLVED FURTHER THAT Mr. ___________________, Director/Secretary of the Company be and is hereby authorized to take all necessary steps to give effect to the said resolution.”
i hope it will serve to all your above mentioned questions
regards
BHAVIN SHETH
Still Learning
(cs)
(234 Points)
Replied 04 December 2013
Dear Bhavin,
Thanks a lot.
But we plan to appoint MD in a board meeting and not in the general meeting.Will explanatory statement be required if we are appointing him in a Board meeting?
CS BHAVIN SHETH
(MANAGER-Company Secretary)
(131 Points)
Replied 04 December 2013
Dear Sayali,
In My view, for the case as said by you, if appointment is made in Board meeting, there is no need of explainatory statement required
regards
BHAVIN SHETH
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 06 December 2013
Hi
The provision of section 269 and remuneration clause of Companies Act, is not applicable for private limited company. So you are free to appoint him at Board Meeting with or without remuneration as you think fit subject to your company's articles.
In that case, you will only file form 23 and 32 with ROC with in 30 days from the date of appointment.
CS MOHIT SALUJA
(PRACTICING CS Jalandhar 9914558709)
(5155 Points)
Replied 07 December 2013
A company cannot appoint a person directly as Managing Director. For a person to be MD, he must be Director first of all.
So First appoint the person as an Additional Director as per Section 161 of the CA, 2013 (It is applicable now). and File Form 32. There after file Form 23 as per section 194 (c) of CA, 1956 stating that the company has accorded approval of Board to change his designation as MD from Additional Dirctor by an ordinary resolution and for this the company need to give explanatory statement along with notice sent to the Board as it is the requirement for filing of the Form 23 and ROC will also demand Explanatory statement. However under section 173, no where has been mentioned that explantory statement has to be given for passing of board resolution rather it is required for any special business to be passed s per Section 102 of CA, 2013 (which is now appicable)
after the approval of Form 23, File form 32 for change in designation of director to Managing Director
Still Learning
(cs)
(234 Points)
Replied 09 December 2013
He is already a Director.there is a change in designation from director to MD.
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 09 December 2013
Yes, you will file Form32 and 23 as i earlier said.
Form-32 for change in designation from director to Managing director.
Form-23 is required as per section 192.
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