Dear all,
Can we appoint a CS in whole time employment of a Company in its subsidiary companies as well? From where does the restriction that CS should not be employed in more than one company comes?
Mayuri (Company Secretary) (33 Points)
24 January 2014Dear all,
Can we appoint a CS in whole time employment of a Company in its subsidiary companies as well? From where does the restriction that CS should not be employed in more than one company comes?
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 24 January 2014
Sec.383A says: "Every company having such paid up share capital as may be prescribed shall have a whole-time secretary......". The words 'whole-time' indicate that the CS can work as CS on whole-time basis in one company only. In case of directors limited exception has been provided in the Act, but not so in case of CS.
Mayuri
(Company Secretary)
(33 Points)
Replied 24 January 2014
But as per Companies Act, 2013, a CS can be employed in a Company and its subsidiaries. If its not restricted anywhere else, a CS in employment will be able to be appointed in more than one company as soon as the relevant section is notified.
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 24 January 2014
Reply to your query is based on the law as is applicable today, i.e under Companies Act 1956.
Section 203 of Companies Act 2013 which permits appointment of same person in its subsidiary at the same time has not yet come into force. Such specific provision is not there at present in Companies Act 1956 and hence simultaneous appointment in both companies is not permissible today.
sathish kumar
(manager)
(41 Points)
Replied 14 April 2014
Sir,
pl. explain the applicability of 203 (3) CA 13 now, can a CS of holding now act as CS of subsidary co. too
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 15 April 2014
Yes, now it is specifically permitted u/s 203(3).
sathish kumar
(manager)
(41 Points)
Replied 15 April 2014
But in section 203
"A whole-time key managerial personnel shall not hold office in more than one
company except in its subsidiary company at the same time" it means he can employed in subsidiary co. not as KMP.
"Provided further that whole-time key managerial personnel holding office in more than
one company (means a WTKMP also employed in other co.)
at the same time on the date of commencement of this Act, shall, within a period of six months from such commencement,
choose one company, in which he wishes to continue to hold the office of key managerial personnel:"
Interpretation - A Company Secretary (KMP) of holding Co. allowed to be employed in subsidary co. but not as KMP in subsidiary co. Pl. correct me if Im wrong.
Also -How whole time employed CS of holding be whole time employed of subsidiary.
In practical - if holding in delhi but subsidiary is in chennai, how whole time company secretary of holding be a whole time company secretary of subsidiary.
he exemption to subsidary violates rule 8 below - subsidary is public ltd more than 10 Cr. paid up cap.
"8. Appointment of Key Managerial Personnel.-
Every listed company and every other public company having a paid-up
share capital of ten crore rupees or more shall have whole-time key
managerial personnel."
Our co. becomes subsidiary due to inclusion of preference shares in the holding - subsidary realationship in new CA 2013.
Pl. clarify..
Live Course on Invoice Management System (IMS) - 2nd Batch(With Recording)
CAclubindia
