Ad-Free CAclubindia and Daily Updates on your mobile. Subscribe Now!

Managing Director

Amisha (Asst. Company Secretary) (205 Points)

10 February 2011

Dear All

There is one company named as "A" Limited (An public Listed Company with more than 5 Cr of Capital)

Now MD of the said company wants to resign.

The Question is whether the New MD should be appointed immediately or time can be taken for finding New appropriate MD.

Also whether the Special Resolution is required in general Meeting or Board Resolution will do (in case he is not drawing any remuneration)

experts view solicited

thanks & Regards,

Reply
Follow
Share

3 Replies

Jayashree S Iyer (Company Secretary) (3224 Points)
Replied 10 February 2011

Replies are marked bold.

There is one company named as "A" Limited (An public Listed Company with more than 5 Cr of Capital)

Now MD of the said company wants to resign.

The Question is whether the New MD should be appointed immediately or time can be taken for finding New appropriate MD.

Naturally it is not possible to find the new person immediately. So within a reasonable time substitute must be found and appointed as MD. If you can substantitate the gap in filling the vacancy, there shouldn't be any problem. This is my view.

Also whether the Special Resolution is required in general Meeting or Board Resolution will do (in case he is not drawing any remuneration)

Board Resolution is sufficient.

The new MD can be appointed by the Board, under Section 260 or 262 of the Companies Act, to fill the casual vacancy created by the resignation of the current MD and he can be regularlised in the next AGM or in the Extraordinary General Meeting if any convened before the AGM.

Upgrade to CAclubindia Pro. Subscribe Now!

Amisha (Asst. Company Secretary) (205 Points)
Replied 10 February 2011

Thanks Jayshree

but as u said "within a reasonable time substitute must be found and appointed as MD"

means there is no specific time limit prescribed by the Law. right ?

Thanks & Regards,

sameera (student) (61 Points)
Replied 13 February 2011

for the above query since u said that the concerned company is a listed company i think as per the listing agrement within 180days you must fill the position of MD

correct me if iam wrong

thanks \

sameera