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2022 (1) TMI 463 - Tri - Companies LawSeeking removal from the Director Board of Kerala Chamber of Commerce and Industry - seeking direction for continuation as Director even after knowing the office of director held by them is vacant - validity of resignation of director - supersession of Board of Directors of the R1 Company by the NCLT appointed Chairman - HELD THAT:- If the office of any Director appointed by the Company in General Meeting is vacated before his term of office expires in the normal course, the resulting vacancy may, in default of and subject to any regulations in the Articles of the company, be filled by the Board of Directors at a meeting of the Board which shall be subsequently approved by members in the immediate next General Meeting. Any person so appointed shall hold office only up to the date up to which the Director in whose place he is appointed would have held office if it had not been vacated - As per Section 149(1) of Companies Act, 2013, every company shall have a Board of Directors consisting of individuals as directors and shall have a minimum number of three directors in the case of a public company. However, there may be instances where the company during the course of business fails to meet the statutory limit. This also shall amount to casual vacancy in the office of director. There are no records showing that the office of Director who was appointed by an AGM is vacated either due to unforeseen reasons or due to any reasons by which the company fails to meet the statutory obligation. It is clear that the appointment of 4 Additional Directors in the Board Meeting dated 13.12.2017 was beyond the powers of the Board as provided in the Articles of Association of the Company and hence it is to be declared as ultra vires and illegal. Clause 51 of the Articles give power to the Board only to fill casual vacancies in the Board. Therefore, the appointment of these four Additional Directors under the pretext to fill casual vacancies as caretakers is against the cardinal principle of corporate law in as much as there were no casual vacancies at all on the date of appointment - in the letter of resignation it should be clearly mentioned the date from which the resignation takes effect. Otherwise the date of receipt of letter will be considered as date of resignation. The Companies Act, 2013 through Section 168 clearly lays down requirement for resignation, by virtue of Section 6 of the Companies Act, 2013, which provides that the provisions of the Act, 2013 shall override MOA and AOA, any provisions of AOA to the extent that it is repugnant to provisions of the Act would become void. The applicants have also made out a case that R10 is disqualified under Section 167 of the Companies Act, 2013. From the records, it is seen that the Registrar of Companies initiated an inquiry against the Company and the said inquiry report is pending with the Ministry of Corporate Affairs for approval. As no concrete evidence is produced with this application to prove the above aspect, we cannot consider the allegation in the present IA and that will be dealt with, when the main Company Petition is taken up for hearing, provided the report is produced before this Tribunal. Application disposed off.
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