By:Shreya Shankar Roll Number - 710

CHAIRMAN OF A COMPANY
Section 175 of the Companies Act -Election of chairman by the members at general meeting -subject to conditions

Regulation 76(1) of Table A -election of Chairman -period to hold office

Incase no chairman is elected or does not appear for meeting? -Regulation 51 of Table A -Directors or members shall pick one of the board members to chair the meeting

Regulation 56 of Table A -``The chairman, if any, of the board shall preside as chairman at every general meeting of the company.' -Faster v. Faster 1916 1 Chancellor 532

DUTIES OF THE CHAIRMAN

Call meetings of the Board and the Shareholders including special meetings Add or omit issues from the meeting discussion Lead meeting of the board of directors Bring an end to all meetings and call for votes on any issue to be settled Make procedural decisions when there is conflict among members of the Board Must be aware of all the rules and procedures that the Company works according to Follow all rules and regulations imposed by state law and the corporations by-laws and other agreements in order to ensure the effectiveness of all meetings

APPOINTMENT OF A MANAGING DIRECTOR

Section 2(54) Definition of Managing Director Section 269 Appointment of Managing Director in a public company Individual Maximum Term 5 years S. 196(2) Can a Managing Director be appointed if he is already a Managing Director of another company? *Private Company No restriction *Public Company (including subsidiary) Restricted to one other

REMUNERATION OF MANAGING DIRECTOR

Cannot exceed 5% of the net profits, 10% all together, in case more than one MD Company Law Board v. Upper Doab Sugar Mills Ltd. (1977) 2 SCC 198 1974 Amendment Section 637-AA

APPOINTMENT OF DIRECTORS

Section 252 Min. No. of Directors - Public and Private Companies

Who can be appointed as a Director? *Individual

Methods of appointment *Section 255 General Meeting -B.R. Kundra v. Motion Pictures Assn. (1976) 46 Comp Cas 339 Del. Director cannot prolong tenure by not holding meeting *Section 255(2) - Nomination *Section 257 Fresh Appointment *Section 262 Appointment by Board -Viswanathan v. Tiffins B.A. & P. Ltd AIR 1953 Mad 520 Conflict as to appointment of directors during General Meeting over Board Appointment -Ananthalakshmi Ammal v. IT & I Ltd AIR 1953 Mad 467 Board can exclude General Meeting Appointments *Section 263 Voting on individual basis *Section 265 Proportional representation *Section 402 Company Law Board *Section 408 Central Government

CONDITIONS FOR APPT. OF MANAGING DIRECTOR AND WHOLE TIME DIRECTORS(Schedule V)

Not have been sentenced to imprisonment or fined under certain statutes Not have been detained or convicted under Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974. Must be a managerial person Must be resident of India Age Limit - above 25, less than 70 Must obtain Director Identification Numbers (Section 266-A to E)

CONDITIONS FOR DISQUALIFICATION OF A DIRECTOR (Section 274)

PUBLIC COMPANY *failure to file annual accounts & returns *failure to repay deposits or interests *redeem debentures or pay dividends

PRIVATE COMPANY *Insolvent *Suspended payment to creditors *Made composition with creditors *Convicted for offence of moral turpitude

REMOVAL AND RESIGNATION OF A DIRECTOR

REMOVAL (Section 284) - Steps: *Special Notice *Ordinary Resolution *General Meeting

-Excludes those appointed by: *Central Government *Proportional Representation *Directors appointed for life -Swapan Das Gupta v. Navin Chandra Suchanti (1988) 64 Comp Cas 562 Removal or Expiry of term of Managing Director does not amount to cessation of office as director -Reappointment of Retiring Director *Section 256 of the Companies Act *Subject to the conditions laid down in Swapan Das Gupta v. Navin Chandra Suchanti

RESIGNATION -Not mentioned directly in Companies Act, but Section 318 mentions indirectly -Articles of Association -Steps: *Resignation Letter *Filing Resignation Form -Mother Care (India) Ltd. V. Ramaswamy P. Aiyar (2004) 51 SCL 243 Kant A retiring director cannot escape from his obligations towards the company -Managing Director *In case of managing director, as provided for in the contract of employment *Managing director entitled to compensation *Section 220 Managing Director not liable for compensation post retirement

DUTIES OF DIRECTORS
Fiduciary Duties -act honestly -bona fide -no conflict of personal interest with company interest Common Law Duties -exercise reasonable skill and care -act within powers of the company -independent decision making -supervise other officers of the company -director-company confidentiality Specific Duties as specified under the Companies Act -duties during winding up of the firm -duties for administration and management of the company -restrictions on disclosure of certain information and activities Additional duties (in case of listed companies) -declaration of pecuniary relations and material contracts Other statutory duties -as under competition act, labour laws, negotiable instruments act, Foreign Exchange Management Act

LIABILITIES OF DIRECTORS
Personal Liability *liability for tax *debts of the company *liability for companys contracts *Refund of share application money *liability to pay for qualification shares\ *mis-statement in the prospectus *unlimited liability *fraudulent conduct of business

Criminal Liability *dishonored cheques *mis-statement in the prospectus *offences under the income tax act *offences under labour laws *lifting of the corporate veil Derivative action suits against directors

CHANNEL OF THE DECISION MAKING PROCESS

BOARD OF DIRECTORS

CHAIRMAN AND MANAGING DIRECTOR

FUNCTIONAL DIRECTORS

EXECUTIVES/HODS

BOARD OF DIRECTORS
Management of the company is assigned to the Board Working organ of the Company POWERS *Powers exercised only in the meetings of the Board (Section 292) *Powers exercised only with the consent of the company in general meetings (Section 293) RESTRICTION ON POWER *the directors cannot do nothing which the company itself, their principal, cannot do under its MOA. *Board shall not exercise those powers or do any act which they are required or directed either by the Act, or by any other act or by MOA or AOA REQUIRED TO BE DONE BY THE GENERAL MEETING

THANK YOU