Plz advice ;
1. In form 24AA , are the directors required to disclose their interest in foreign companies also, if yes - beyond how much percentage ?
2. What if the relatives of directors are interested ?
Regards
Neeta
Neeta (Finance) (345 Points)
19 April 2010Plz advice ;
1. In form 24AA , are the directors required to disclose their interest in foreign companies also, if yes - beyond how much percentage ?
2. What if the relatives of directors are interested ?
Regards
Neeta
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 19 April 2010
Form 24AA is the form for disclosure of interest by directors only.
Yes in form 24AA interest in foreign companies also requires disclosure irrespective of the percentage. Remember direct or indirect interest. Don't mix this reply with section 299(6). This is my personal practice as according to me indirect interest is the most dangerous thing from ROCs point of view.
Best Regards
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 19 April 2010
Dear Neeta ji,
Yes, interest in BODY CORPORATE is required to be disclosed.
Under section 299(3)(a), form 24AA is a General Notice to the effect that the director of the company intimated the Board that i am a Director or member in the specified Body Corporates or the member in the specified firm. And to be regarded as interested in any contract with those body corporates for firms which may be entered after the date of this notice.
Neeta
(Finance)
(345 Points)
Replied 19 April 2010
Sir
Plz advice further on the nature of interest . I think the Act no where specifies about 'nature of interest'.
So , does it mean only 'directorship in other companies' ?
plz confirm whether we need include if;
1. our director is only director and not shareholder in the other company???
2. our director is only shareholder and not director in the other company???
Thanks and Regards
Neeta
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 20 April 2010
In most of the cases it is directorship in other companies. Other criteria is if he can influance the transaction by virrtue of his position.
But if your director is a shareholder in other company than prima facie no disclosure is required. But on the other hand if he is holding something around 80% stake ---things may be different.
For removal of doubts we need to understand the theme and purpose of introduction of sections like 299.
Neeta
(Finance)
(345 Points)
Replied 20 April 2010
thank u so much sir . True we need understand the concept and i think ( if i m right ) it is a relation with the company through which you can influence the transaction , so it can be .. being a director or shareholder. So the definition goes inclusive and not exclusive to avoid any future probs. And the things depends on case to case.
thanks again sir.
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 20 April 2010
Thumb up to your quick understanding...
I know the seriousness of sections like 295, 297, 299, 301 and 314 etc. If you wanna keep your record clean and avoid your company from section 234 than you have to understand the theme and purpose of these sections.
ROC can make your life hell if you got stuck under section 234. Showing language of section to ROC is of no use. I observed the same very deeply during my ROC training at Delhi ROC with lots of top companies files.
Regards
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