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Sec 299 Form 24AA

Priya Sharma (Company Secretary & Student.MBA) (998 Points)

13 August 2009

As per section 299(3) of the Companies Act, every Director is required to file form 24AA.So my question is whether this form is to be filed in every financial year.????

Also for eg if a director resigned on 01/11/2007 from co. Y and he has to file form 24AA for co. X and the notice date(form 24AA) is 25/10/2007,, so will he show his directorship in Co. Y????

Plz reply urgent

Regards

Priya

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10 Replies

Ajay Mishra (Company Secretary) (74337 Points)
Replied 13 August 2009

General notice given by the director under section 299 in Form No. 24AA expire at the end of the financial year. It can be renewed by giving a fresh notice in the last month of the financial year in which the notice expires. The notice is effective only if it is brought to notice of the Board and read in the first meeting after such notice is given.

At the time of filing of form 24AA to company x , he is director of company y so it is required to give the general notice about his directorship including company Y.

Regards

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P C Agrawal (Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad) (8229 Points)
Replied 17 August 2009

Yes, I agree with Mr Ajay. I would only like to clarify that submission of form 24AA is optional and not mandatory by law. The director can choose to disclose his interest in any contract which is being approved by the Board in the meeting on case to case basis. However, it is advisable to obtain general declaration to avoid consequences for not disclosing the interest by oversight in any particular case.

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 17 August 2009

To download sample Form 24AA click the link below:

Sample Form 24AA_Disclosure of Interest by Directors

SRI (TRAINEE) (22 Points)
Replied 24 September 2009

I what to know in what cases or rather what are the matters to be disclosed by the Directors in Form 24AA (how can we interpret the words "Nature of Interest").

Should the Director disclose his interest in a foreign company also ( like if he holds more than 2% shares in a Foreign Company)

Please help me and provide me the information as to what are the matters that are to disclosed by the Directors and when the directors are liable to disclose.

Regards

Sridevi

Ajay Mishra (Company Secretary) (74337 Points)
Replied 26 September 2009

Disclosure of Nature of Interest whether direct or indirect

A director is said to be directly concerned or interested in a contract or arrangement, when he himself has personal interest in a particular contract or arrangement. Whereas a director is said to be indirectly concerned or interested when any of his relatives and associates has got personal interest in the particular contract.

Word ‘interest’ occurring in sections 299 and 300 means personal interest and not official or other interest.

In Yashovardhan Saboo v. Croz-Beckert Saboo Ltd. (1995) the CLB says “The provisions enacted in section 297, 299 and 300 of the Companies Act are founded on the principle that a director is precluded from dealing on behalf of the company as himself and from entering into engagements in which he has a personal interest conflicting or which possibly may conflict with the interest of those with whom he is bound by fiduciary duty.

Section 299 does not prohibit from disclosing his interest in foreign company also, if such director hold more than two percent of the paid up capital of the foreign company.

Regards

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Sanjay (Proprietor) (28 Points)
Replied 10 October 2009

where i will get the format of form 24AA U/S 299

Tina Mehta (article) (22 Points)
Replied 09 April 2010

hiiii................

Can a private companies purchase the shares of other private company if such purchase amount to 45 % of capital in the target company. And both the companies have 2 common directors.If yes what disclosures are required by the company and directors.

CS Jithesh (ACS,) (COMPANY SECRETARY ) (485 Points)
Replied 09 April 2010

Ofcourse a pvt company can purchase shares of other pvt company

All those transactions which are directly or indirectly interested by the directors

The Form 24 AA will contain the name of teh company, CIN and the nature of interest (like director, secretary...)

The same has to be placed before the board every year

Regards

CS Jithesh

1 Like

Tina Mehta (article) (22 Points)
Replied 10 April 2010

Thank You..........Very much Sir..............................

Gurleen (CS) (36 Points)
Replied 10 November 2011

In Form 24AA, any interest of a director and/or his relatives in companies that exceeds 2% of the stock of such company has to be listed. Since a foreign director of an Indian Pvt co is not interested to make his interests public, is there another way for him? Kindly suggest.