Thursday, June 04, 2009

Companies Act_Practical Problems_84

The Board of Directors of ABC Private Limited having a paid-up share capital of Rs. 1 Crore consists of two directors, one of them, viz, Mr. S possesses membership of the Institute of Company Secretaries of India. The company desires to appoint him as a company secretary also. State the legal position.

Under Section 383A of the Companies Act, 1956, in case of a company having only two directors, none of them can be appointed company secretary in spite of possessing the requisite qualification. In view of the overriding effect of Section 383A, consideration of section 314 is unnecessary.

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