Kamal Lahoty (Practising Company Secretary) (274 Points)
30 July 2012
Dear Kamalji,
Section 299 of the Companies Act 1956 applies to all types of companies, public and private as well. It also applies to all types of directors. It applies to directors nominated by the government. (Please refer DCA circular no. 9/19(299) 63-PR, dated 20 September 1963). Further, it also applies to other nominee directors.
Section 299 applies to arrangements, besides contracts, in which a director is concerned or interested 'in any way', 'whether directly or indirectly', eg, a contract in which a director is interested through his relatives. (Please refer the case law, Pydah Venkatachalapati versus Guntur Cotton, Jute & Paper Mills Co. Ltd. AIR 1929 Mad 353).
Regards,
Veeral Gandhi