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Company Law
Notes
10.10 Removal of Directors
10.10.1 Removal by Shareholders
10.10.2 Removal by the Central Government
10.10.3 Removal by Company Law Board
10.11 Retirement of Director
10.12 Appointment of a Director other than a Retiring Director
10.13 Power and Fiduciary Duties
10.13.1 Powers of the Board of Directors
10.13.2 The Mode or Manner of Exercise of Board’s Powers
10.13.3 Restrictions on Powers of Directors
10.14 Duties of Director in Relation to Good Corporate Governance
10.15 Summary
10.16 Keywords
10.17 Review Questions
10.18 Further Readings
Objectives
After studying this unit, you will be able to:
Describe the legal position of director;
Outline the qualifications and disqualifications of director;
Explain the director remuneration;
Elaborate upon principles of disclosure.
Introduction
A company, being an artificial person, acts through human agency. Accordingly, under the Act,
it is necessary for every company to have a Board of directors. In addition to this, the following
categories of managerial personnel may be appointed (s.197-A):
1. Managing Director; or
2. Manager.
Section 197A does not prohibit the employment of other managerial personnel, such as executive
or whole-time directors, which do not come within the term “managing director” or “manager”.
Thus, it is possible for a company to make simultaneously the appointment of (i) managing
director and whole time director; or (ii) manager and whole time director. Section 197A prohibits
the simultaneous appointment of managing director and manager in the same company.
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