DCA's Letter : No. 8/16(1)/61-PR, - dated - 23-01-1961

[anjali bansal]

Hi

 

Can some one please provide me a copy of DCA's Letter : No. 8/16(1)/61‑PR, - dated - 23-01-1961.

 

 

Thanks

 

Anjali

[Vidhya]

Hi Anjali,

LETTER NO:8/16(1)/61-PR dated 23 January 1961

Section 314 does not make it clear if a special resolution is required to be passed if an employee of company becomes related to a Director of the Company during the course of his employment.

a).In case he had been appointed before the director becomes a Director of the Company; and 

b).In Case he had been appointed after the Director  became a Director which contingency is not provided for under the newly inserted Sub Section (1A).

DEPARTMENT CLARIFICATION:

The Department's view is that only the case of employee-relatives,already in office before the relative becomes a Director ,are covered by sub section (1A) of the amended Section 314.As Such,where an employee is appointed to his office before the Director becomes a Director but the employee becomes related to the Directors afterwards,as well as the cases falling under category (b) in the query,will require  special resolutions to be passed under Section 314(1).

I dont have department copy with me..I have verified in one book..If you need any clarification,let me know

regards,

Vidhya

 

Anjali

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