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Director may be defined as an individual who directs , controls or manages the affairs of the company.
The directors of the company collectively are referred to as the board of directors or board
Qualification
No educational or other qualifications are required in order to become director of the company whether public or private. Similarly, the Companies act 1956 does not prescribe any requirement as to age limit for becoming a director. The only condition is as per section 253 No body corporate, firms or associates can become a director. Only Individual can be a Director of a company because the office of a director is office of responsibility, accontability and position of trust.
Number of Directors
As per section 252 every public company shall have 3 directors and every other company shall have at least 2 directors. Maximum no. of directors in case of private company shall be as specified by the articles. It could be 7 or 8 or even 20 or 25.Central Govt. approval not required in case of any increase in number. The act does not prescribe any maximum number of directors for public company also but if the maximum no of directors exceed 12, prior approval of central Govt. would be required. Thus the approval of central govt will be necessary for the increase in number of directors , and not for the appointment .
Appointment of DIRECTORS
The appointment of directors is accordingly regulated by the act. Directors may be appointed in following ways:-
By the articles as regard first directors [sec. 254] By the company in general meeting [sec. 255 to257 , 263 , 264] By the directors [sec. 260 , 262 , 313] By third parties [sec. 255] By the principle of proportional representation [sec. 265] By the central government [sec. 408]
Section 264of the companies Act requires every director to give his concent to the directorship. There are two types of Consents : 1.Concent of the candidate for Directorship to be filed with the company 264(1) 2.Concent to act as director to be filed with the registrar 264(2) . The consequence of a director continuing to act as such without filing his concent within the period specified would attract the penalty under section 629A i.e.Rs. 500 Every day. Such concent may however be filled after the expiry of the said period on payment of additional fees as contemplated by section 611(2). It is further open to the central government u/s 637B to condone the delay in filling concent.
BY THE DIRECTORS
The directors are empowered to appoint : Additional directors Alternate directors Directors filling casual vacancy
ADDITIONAL DIRECTORS
The board of director may appoint additional directors from time to time if so authorised by the articles. The number of directors and additional directors must not exceed the maximum strength fixed for the board by the articles. The additional directors shall hold office only upto the date of next annual general meeting.
ALTERNATE DIRECTORS
The board of directors may appoint an alternate director if authorized -By the articles -By a resolution of the company at general meeting
An alternate director acts in the place of a director who is absent for more than three months from the state in which board meetings are held. He must vacate the office on the return of the original director.
CASUAL VACANCY
Where the office of any director appointed by the company in general meeting is vacated before the expiry of his term the director may fill up the vacancy at the meeting of board. Any vacancy other than one caused by retirement of a director by rotation is a casual vacancy. Such a vacancy may occur by reason of death , resignation , bankruptcy , or disqualification. The director so appointed will hold office till the end of the term of the director in whose place he is appointed.
Managing Director:
Managing Director means a director who :
a. b.
c.
d.
Is entrusted with the substantial powers of management which would not otherwise exercisable by him, and includes a director occupying the position of managing director , by whatever name called.
Provided further that a managing director of a company shall exercise his power subject to control & directions of its Board of Directors.
Manager :
Manager means an individual who subject to the control & direction of board of directors has the management of the whole or substantlly the whole of the affairs of the company. And includes the director or the any other person occupying the position of manager, by whatever name called,and whether under a contract of service or not. A manager may or may not be a director of a company. Company cannot have simultaneously two managers . Acompany cannot at a same time employ a managing Director and a manager. However a company can simultaneously a manager an da whole time director . Only An individual can be appointed as a manager. No firm or body corporate can be appointed as a manager.
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