|
|
|
|
3.
Manner of election of small shareholders’ director
-
A
company may act suo-moto to elect a small shareholders’
director from amongst small shareholders or upon
the notice of small shareholders, who are not less
than 1/10th of total small shareholders and have
proposed name of a person who shall also be a small
shareholder of the company.
-
Small shareholders intending to propose a person
shall leave a notice of their intention with the
company at least 14 days before the meeting under
the signature of at least 100 small shareholders
specifying name, address, shares held and folio
number and particulars of share with differential
rights as to dividend and voting, if any, of the
person whose name is being proposed for the post
of director and of other small shareholders proposing
such person as a candidature for the post of director
or small shareholders.
-
A person whose name has been proposed for the post
of small shareholders’ director shall sign,
and file with the company, his consent in writhing
to act as a director.
-
The listed public company shall elect small shareholders’
nominee subject to sub-rules (1), (2) and (3) above
through the postal ballot.
-
The unlisted company may appoint such small shareholders’
nominee subject to above conditions if majority
of small shareholders recommend his candidature
for the post of director in their meeting.
-
Tenure of such small shareholder’ director
shall be for a maximum period of 3 years subject
to meeting the requirement of provisions of Companies
Act except that he need not have to retire by rotation.
-
On
expiry of his tenure, the same person if so desired
by small shareholders, may be elected for an another
period of 3 years.
-
Such director shall be treated as director for all
other purpose except for appointment as whole time
director or managing director.
4.
Disqualification
A
person shall not be capable of being appointed as small
shareholders’ director of a company, if-
-
he has been found to be of unsound mind by a Court
of competent jurisdiction and the finding is in
force;
-
he is an undischarged insolvent;
-
he has applied to be adjudicated as an insolvent
and his application is pending;
-
he has been convicted by a Court of any offence
involving moral turpitude and sentenced in respect
thereof to imprisonment for not less than six months,
and a period of five years has not elapsed from
the date of expiry of the sentence;
-
he
has not paid any call in respect of shares of the
company held by him, whether alone or jointly with
others, and six months have elapsed from the last
date fixed for the payment of the call; or
-
an order disqualifying him for appointment as director
has been passed by a Court in pursuance of section
203 and is in force, unless the leave of the Court
has been obtained for his appointment in pursuance
of that section.
|
|
|
|
