Section 268 of the Companies Act, 2013
Section 268 of the Companies Act, 2013 – Appointment of Managing Director, Whole-time Director, or Manager
🔹 Objective:
Section 268 provides the procedure and approvals required for appointing a Managing Director (MD), Whole-time Director (WTD), or Manager in a company.
✅ Key Provisions:
Board Resolution:
The appointment of an MD, WTD, or Manager must be made by a resolution of the Board of Directors at a duly convened meeting.
This resolution must specify:
The terms and conditions of appointment,
Remuneration, and
Duration of the appointment.
Approval by the Company:
The appointment must be approved by the company in a general meeting by an ordinary resolution.
In case of a public company, such approval is mandatory unless otherwise prescribed.
Filing with Registrar of Companies (ROC):
The company must file the particulars of the appointment with the ROC within the prescribed period.
Compliance with Section 196:
The appointment must also comply with Section 196, which restricts the term and remuneration and mandates adherence to other related provisions.
📌 Purpose:
Ensures transparency and formal approval for senior managerial appointments.
Protects the company and shareholders by mandating clear terms of appointment.
Provides legal validity and regulatory compliance.
🧾 Summary Table:
| Step | Requirement |
|---|---|
| Board Meeting | Pass resolution for appointment with terms |
| Shareholders | Approve appointment by ordinary resolution |
| Filing | File appointment details with ROC |
| Compliance | Follow Sections 196 and other relevant provisions |
Related Sections:
Section 196 – Appointment of MD, WTD, Manager – conditions and term.
Section 197 – Remuneration of Directors.
Section 203 – Appointment of Key Managerial Personnel (KMP).
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