Classification of Rule 8 and Rule 8A of Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2014

[BalaJi Srivastava]

Rule 8 Appointment of Key Managerial Personnel.-

Every listed company and every other public company having a paid-up share capital of ten crore rupees or more shall have whole-time key managerial personnel.

Ok Considering Rule 8 the appointment of KMP would be done for all Public Companies and Listed Companies having Paid Up share capital of Rs. 10 Crore. The word every other consists of those Public Companies having paid up share capital of Rs. 10 Crore, which further means below mentioned companies are not required to appoint any KMP:

 

a)       A Private Company(Irrespective of its Capital Size).

b)      A Public Company having Paid up Share Capital of Less than 10 crore.

 

Now Coming to Rule 8A of 09.06.2014

 

“8A. Appointment of Company Secretaries in companies not covered under rule 8.—A company other than a company covered under rule 8 which has a paid up share capital of five crore rupees or more shall have a

whole-time company secretary.”

a)      Interpreting the substance of the rule - A company other than a company covered under rule 8  = A Private Company(Irrespective of its Capital Size) and A Public Company having Paid up Share Capital of Less than 10 crore.

b)      Limit of the required appointment of Company Secretary under the Rule 8A= Company having Paid Up share Capital of Rs. 5 Crore and above, Irrespective of Company Type.

 

Conclusion: The Rule 8A has an overriding affect on the terms of Appointment of Company Secretaries. The wordings of the Rule 8A are self explanatory about the word A Company – Thus, removing the Barrier of Classification of company whether public or private. Therefore we can conclude that the Any Company having paid up share capital of Rs. 5 Crore and above have to appoint a whole-time company secretary and the same shall further be part of KMP for the companies as defined in Rule 8 of Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2014.

 

Friends this is my understanding and perhaps we should not confuse with it. Other suggestions are most welcome. 

Many thanks

Thanks and Regards,

Balaji Srivastava
Mobile: +91 (0)987-316-9769
Email:bbala...@gmail.com

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[Vivek Hegde]

I agree with your reasoning Balaji. There is no room for confusion.

Warm Regards

CS Vivek Hegde,B.com, ACS, CWA

Vivek Hegde & Co.
Company Secretaries
No. 2034, 26th Cross, K.R.Road
Banashankari II Stage, Behind 

Sevakshetra Hospital

Bangalore-560070
Mob : 09900898223

Off: 080 26710677

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[CS A Rengarajan]

Please  read  Rule  8  

8. Appointment of Key Managerial Personnel.- 

Every listed company and every other public company having a paid-up share capital of ten crore rupees or more shall 

have whole-time key managerial personnel. 

It  means  listed  company  having  a  paid  up  share  capital  of  Rs.10  crore  or  more  shall have  wholetime  key  managerial  personnel.  Below  Rs.10  crore paid up  capital  for  listed company,  there  is  no  need  to  appoint  whole  time   KMP   

Rule  8  itself  is  debatable   The  word  and  is  in  between  listed  company  and  every  other  public  company.

By  going  this  above  interpretation,  listed  company  having  paid  up  capital less  than   Rs.10  crore  has  to  only  appoint  whole time  company  secretary. 

MCA  has  to  give  clarification  in  this  regard  also.

Others  views  solicited

Best regards

On Wed, Jun 11, 2014 at 6:15 PM, BalaJi Srivastava <bbala...@gmail.com> wrote:

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A.Rengarajan

Company  Secretary

Chennai

93810  11200

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[CS A Rengarajan]

Please  read  Rule  8  

8. Appointment of Key Managerial Personnel.- 

Every listed company and every other public company having a paid-up share capital of ten crore rupees or more shall 

have whole-time key managerial personnel. 

It  means  listed  company  having  a  paid  up  share  capital  of  Rs.10  crore  or  more  shall have  wholetime  key  managerial  personnel.  Below  Rs.10  crore paid up  capital  for  listed company,  there  is  no  need  to  appoint  whole  time   KMP   

Rule  8  itself  is  debatable   The  word  and  is  in  between  listed  company  and  every  other  public  company.

By  going  this  above  interpretation,  listed  company  having  paid  up  capital less  than   Rs.10  crore  has  to  only  appoint  whole time  company  secretary. 

​  This  is  as  per  Rule  8A   issued  recently.​

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Posted by: CS A Rengarajan <csaren...@gmail.com>

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[BalaJi Srivastava]

Sir,

This would mean every listed company and all other public company wd puc of 10 crore or more...

I think listed here includes all listed companies. 

Views solicited

[BalaJi Srivastava]

Dear Members,

Request for a response in this regard.

Many thanks

Thanks and Regards,

Balaji Srivastava
Mobile: +91 (0)987-316-9769
Email:bbala...@gmail.com

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[Deepesh Nayak]

Sir, we should read the listed company separately (without any criteria of paid up capital) and any other public company which have puc 10 crore or more.

Your logic is correct.

Regards,

Deepesh

Thanking you,

*CS Deepesh Kumar Nayak*
 Company Secretary

 *Mob. 097134-80215*
*csdeepe...@gmail.com*

[Vinod Kashyap]

The interpretation should be made in the interest of the profession....

Vinod  Kashyap

Tel #   +91-11-2364 3234
Cell #  +91-96544 55392

[Vinod Kashyap]

On a second thought, it doesn't sound logical that a Private Company having a paid up capital of Rs. 5 Crores is required to appoint a CS whereas a Listed Company and a Public Company having a paid up capital of Rs. 5 Crores is not required to appoint a CS.

[CS A Rengarajan]

please  read  continuously    and  it  shows  poor  drafting  from  MCA

When  read  separately  the  column  will  be  as  follows

Listed  company

Every  other  public  company  having  paid  up  share  capital  of  Rs.10  crore

Then  what  you  are  mentioning  is  correct.  We  can  take  either  way 

regards

On Thu, Jun 12, 2014 at 10:51 AM, Deepesh Nayak <csdeepe...@gmail.com> wrote:

[Deepesh Nayak]

Sir, please find the extract of the rule 8:

"Every listed company and every other public company.......so on.."

It mean Rule 8 is applicable to all:

01.  listed companies (no limit of paid up capital) as well as...

02. public companies having paid up capital of Rs. 10 crore or more.

The word "Every" used separately for each category therefore the rule 8 applicable  to both category of companies separately.

Deepesh

Thanking you,

*CS Deepesh Kumar Nayak*
 Company Secretary

 *Mob. 097134-80215*
*csdeepe...@gmail.com*

[Kamesh]

Dear Deepesh Nayak, the answer given by you is perfect.  I too agree.

Dear Mr. Rengarajan, request to take another topic.  don't try confuse our friends further on this. plsssssssssssss....

Best regards,

Kamesh   

[CS A Rengarajan]

i  am  not  confusing  but  only  views  expressed  by  our  friends

please  don't  use  harsh  words

regards

[Deepesh Nayak]

Thanks Mr. Kamesh,

But this is my interpretation after reading Rule 8 and i request to other learned member specially from Rangrajan sir, because he has raised good question and we should conclude this topic with his opinion on the same.

Deepesh

Thanking you,

*CS Deepesh Kumar Nayak*
 Company Secretary

 *Mob. 097134-80215*
*csdeepe...@gmail.com*

On Thu, Jun 12, 2014 at 3:32 PM, Kamesh <kames...@gmail.com> wrote:

[BalaJi Srivastava]

Dear Friends,

In my opinion all listed companies have to appoint a whole time company secretary. Limits has nothing to do with listed entities with regard to appointment of CS. The word of legislation itself expresses the word "Every Listed Company".

I hope all the learned members might agree to this. Views Solicited.

Many thanks

Thanks and Regards,

Balaji Srivastava
Mobile: +91 (0)987-316-9769
Email:bbala...@gmail.com

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[Manoj Singh Bisht]

Every appears twice.

every listed company AND every public company 

There can not be any other interpretation for Rule 8.

Rule 8A is drafted in very vague manner.

MCA is MCA.

Regards

Manoj

[BalaJi Srivastava]

I dont know I am not confused on any point and both of them are perfectly valid...why is it soo...i hv clearly mentioned even...

Thanks and Regards,

Balaji Srivastava
Mobile: +91 (0)987-316-9769
Email:bbala...@gmail.com

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[csyogan .]

conclusion ...?

whole time cs appointment mandatory for the following :

- listed companies (irrespective of paid up capital)

- unlisted companies (having paid up capital of rs. 5 crores or more)

regards,
yogan.

[AKASH BATRA]

Balaji i think companies which are covered in Rule 8 there is a requirement of KMP(MD,WTD, CS, CFO and 

companies other than Rule 8 (companies includes private companies having paid up capital of rs 5 core or more required only whole time Company Secretary not the KMP)

On Wed, Jun 11, 2014 at 6:15 PM, BalaJi Srivastava <bbala...@gmail.com> wrote:

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[BalaJi Srivastava]

Many thanks for the mail Akash.. I am also mentioning the same thing. The very analysis is encapsulating the aforementioned fact.

Hope this suffice. Many thanks..Appreciate your view

Thanks and Regards,

Balaji Srivastava
Mobile: +91 (0)987-316-9769
Email:bbala...@gmail.com

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[ayan chakrobarty]

yes there are certain confusion in this matter , but going with the spirit of the law , one should understand that every company irrespective of private or public or listed have to appoint a CS if its paid up capital is 5 cr or more

thanks & regards

Ayan Chakrobarty

Ayan Chakrobarty