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Regarding Resigned Directors

Ali Ayaz (Student) (36 Points)

08 December 2019

Hi Please Help us with the below query,

A newly Incorporated co. Incorporated on 08.02.19 with 3 Directors A B & C, the financials are finalized on 11.11.19 and signed by all three directors but due to some issue, on 22.11.19 two directors resigned ( B & C) (Prior to this additional director D was appointed on 20.11.19) Further AGM was conducted on 30.11.19.

My Query

1.Directors report shall be signed by whom (only by A & D)

2.Should Financial statement need to be signed by newly appointed diretor

2.Disclosure in MGT 7 Annual Returns(Shareholders List shall consist by only A & D)

Thanks in Advance

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3 Replies

Devershi Gupta (PCS, LLB) (1272 Points)
Replied 09 December 2019

1&2. Since D was not a director of the company on the date of signing of balance sheet and other financial statements. He had no authority to sign the financial statement.

3. directorship does not affect list of shareholders list of shareholder contains details of shareholders as on last date of f.y.

it must be noted that as per companies act a company is not required to conduct AGM in year of its incorporation.

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Jatin Bajaj (CS) (2930 Points)
Replied 09 December 2019

As the Company was incorporated in the year February 2019 and as per the provisions of section 96 of the Companies Act 2013, the Company shall not hold the AGM in the year of incorporation. Further the first AGM of the Company should have been held within 9 months from the closure of financial year and in the above case financial year should have been closed on 31st March 2020.

Moreover, the Director who were associated with the Company on the date of signing of the balance sheet of the Company were eligible to sign the Board report, so D was not available. A, B and C were available and as per the authority given in the Board minutes any two existing Directors are authorized to sign the Board report,. And new Director need not have to sign the balance sheet. And List of shareholder would not have any impact in MGT 7 as list of Shareholder as on 31st March 2019 shall have the valid relevance.

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