Manager and M.D.
M. N. JHA (CA) (8316 Points)
26 June 2010
Can a manager and managing director may be appointed simultaneously ??? If yes any provision ??
Nitin Grover
(CS)
(1228 Points)
Replied 26 June 2010
Dear friend
Both can not be appointed at same time
Regards
Yogesh Bhatt
(Company Secretary)
(475 Points)
Replied 26 June 2010
Dear JAi Kishan
197A. Company not to appoint or employ certain different categories of managerial personnel at the same time
Notwithstanding anything contained in this Act or any other law or any agreement or instrument, no company shall, after the commencement of the Companies (Amendment) Act, 1960 (65 to 1960), appoint or employ at the same time, or after the expiry of six months from such commencement, continue the appointment or employment at the same, of more than one of following categories of managerial personnel, namely:-
(a) managing director,
(d) manager.
Yogesh Bhatt
(Company Secretary)
(475 Points)
Replied 26 June 2010
Prohibition on appointment of both the managing director and manager at the same time (Section 197A)
A company shall not appoint or employ at the same time both a managing director and a manager. Section 197A makes prohibition on appointment or employment of certain different categories of managerial personnel at the same time. The prohibition is applied to both a public company and a private company.
Yogesh Bhatt
(Company Secretary)
(475 Points)
Replied 26 June 2010
No company can appoint or employ, at the same time, or, continue the appointment or, employment at the same time, of a Managing Director, as well as a Manager.
But, there is no legal prohibition against having a Whole Time Director and Manager, simultaneously, or, Managing Director and whole-time Director, simultaneously. Again, there is no prohibition on a company having more than one Managing Director.
This section applies to all companies, public and private. As per provisions of this section a company cannot apply both managing director and manager at the same time. The term " managing director" and "manager" has been defined in section 2(26) and 2(24) respectively. "managing director is a director who is entrusted with "substantial" powers of management which would not otherwise be exercisable by him. From the definition of managing director it appears that the company may entrust "substantial" power of management to one or more directors and therefore a company may have more than one managing director.Further the expression MANAGING DIRECTOR shall also include a director occupying the position of managing director, by whatever name called.For instance, President, CEO , chief operating officer, etc. in the case of MNCs shall be considered as the MANAGING DIRECTOR for the purpose of COMPANIES ACT, although they are not designated as such.
M. N. JHA
(CA)
(8316 Points)
Replied 26 June 2010
M. N. JHA
(CA)
(8316 Points)
Replied 26 June 2010
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