Number
of Directorships
(1)
No person, after the commencement of this Act, shall hold office as a director,
including any alternate directorship, in more than twenty companies at the same
time:
Provided that the maximum number of
public companies in which a person can be appointed as a director shall not
exceed ten.
COMMENT— For reckoning
the limit of public companies in which a person can be appointed as director, directorship
in private companies that are either holding or subsidiary company of a public
company shall be included.
NOTE—For reckoning the limit of directorships of twenty companies, the
directorship in a dormant company shall not be included.
(2) Subject to the provisions of
sub-section (1), the members of a company may, by special resolution, specify
any lesser number of companies in which a director of the company may act as
directors.
(3) Any person holding office as
director in companies more than the limits as specified in sub-section (1),
immediately before the commencement of this Act shall, within a period of one
year from such commencement,—
(a) choose not more than the
specified limit of those companies, as companies in which he wishes to continue
to hold the office of director;
(b) resign his office as director in
the other remaining companies; and
(c) intimate the choice made by him
under clause (a), to each of the companies in which he was holding the office
of director before such commencement and to the Registrar having jurisdiction
in respect of each such company.
(4) Any resignation made in pursuance
of clause (b) of sub-section (3) shall become effective immediately on the
despatch thereof to the company concerned.
(5) No such person shall act as director
in more than the specified number of companies,—
(a) after despatching the resignation
of his office as director or non-executive director thereof, in pursuance of
clause (b) of sub-section (3); or
(b) after the expiry of one year from
the commencement of this Act, whichever is earlier.
(6) If a person accepts an
appointment as a director in contravention of sub-section (1), he shall be liable to
a penalty of five thousand rupees for each day after the first during which
such contravention continues
DISCLAIMER: THE
ARTICLE IS BASED ON THE RELEVANT PROVISIONS AND AS PER THE INFORMATION EXISTING
AT THE TIME OF THE PREPARATION. IN NO EVENT I SHALL BE LIABLE FOR ANY DIRECT
AND INDIRECT RESULT FROM THIS ARTICLE. THIS IS ONLY A KNOWLEDGE SHARING
INITIATIVE.
THE AUTHOR
– CS DEEPAK SETH (ASSOCIATE PARTNER HELPINGHANDS PROFESSIONALS LLP) AND
CAN BE REACHED AT CONTACTHHPRO@GMAIL.COM OR 9910248911.
0 Comments