Death of a managing director of a pvt ltd co.

Saikat Sen (Querist) 17 June 2012 This query is : Resolved
Dakhineswari cold storage a Pvt ltd co. has been enjoying cash credit limit with our Bank .The MD has expired today.What should be THE change in loan documentation?

Pls. suggest.

Thnks & Rgrds,

Saikat

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Devajyoti Barman (Expert) 17 June 2012
The MD has nothing to do with the LIFESPAN of a Company.
The directors may die but not the company.

Now if the MD was the authorised signatory then such changes may be brought into your records. But the liabilities of the Company would remain unchanged.

Ashish Khandelwal (Expert) 18 June 2012
i agree with Mr. Barman

Saikat Sen (Querist) 18 June 2012
what should be the necessary changes need in loan documentation?

Shashikant V. Patil (Expert) 18 June 2012
There may be some successor to MD after his death, Board of directors will select him and authorised him to function as a new MD. Loan documents are in the name of Co. and not in the name of person.

Saikat Sen (Querist) 18 June 2012
I agree but the MD 's sign exists in loan documents.Is it prevails even after his death? So, is it necessary to take the new set of documents after getting new board resolution.

Shashikant V. Patil (Expert) 19 June 2012
No. After the death of individual, his signature will no more prevails. New MD's authorised signatures will prevail for future business.

Guest (Expert) 20 June 2012
The matter should be brought to the notice of the Board,where a fresh resolution is to be passed in supperssion of your earlier resolution, for change in authorised signatory and then intimate the Bank about the death of your M.D. alongwith a copy of the death certificate,if necessary and copy of the new resolution.

A.K.Maitra,M.Com;LL.B;A.C.A;A.C.S;M.I.M.A
Retd. C.S. & G.M.(Law)
National Fertilizers Ltd.
(A Mini -Ratna Central P.S.U.)
New Delhi

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