If in a public limited company with a paid up capital of Rs. 50 Lacs an employee become a director, how shall he be treated? Simply an executive director or WTD?
TULIKA AGARWAL (Self employed) (80 Points)
05 June 2014If in a public limited company with a paid up capital of Rs. 50 Lacs an employee become a director, how shall he be treated? Simply an executive director or WTD?
RoHaN k
(CA & CS)
(308 Points)
Replied 06 June 2014
In my opinion , He should be Executive Director , for WTD he should possess that requisite quality and continuing relationship with company as designated employee,
If such employee is departmental head or something , after becoming a director he can be only WTD,
Another thing for becoming executive director you may consider application of place of profit.
please provide any counter views on this.
Dipendra Prasad Poudel
(Article Assistant ( Internal Audit) )
(578 Points)
Replied 06 June 2014
Thank you @ Rohan K for your response. I am not totally aware about the situation what @ Tulika has asked. But please refer me the section where WTD requires quality. I have studied about quality required for Independent director 149(6) but not about WTD.
Further under section 177 there requires certain qualities of director to be chairman of audit committee.
In my view if s/he fulfils the certain critarea mentioned in AOA of the company (specially regarding share capital) then he can be director of the company.
He can't be Independent director as he is disqualified under 149 (6)(e) (ii).
He should hold DIN as mentioned under section 152.
Please provide further views for this case.
regards
Dipendra Prasad Poudel
Live class on PF & ESI Enrollment & Returns Filing(with recording)
CAclubindia
