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mike (lawyer patent attorney)     09 September 2008

directorship in both public and PVT

Hi Guys,

I would like to ask for some help. Can a director of a public company be a director of a private company? Or in other words, can a person be a director in both public company and private company? Which law reguate this?

Thanks!

BR

Mike



Learning

 3 Replies

SATISH KUMAR (COMPANY SECRETARY)     09 September 2008

Holding of directorships in companies regulated by companies act, 1956. A person can be a director of both private and public companies. He can hold directorships up to 15 companies in public limited companies. There is no bar in private companies


 


satish

mike (lawyer patent attorney)     10 September 2008

Hi Mr. Kumar,

 


Thank you very much for that.


BR


Mike

Archit (Sr. Manager- Secretarial & Legal)     10 September 2008

Dear Mike,

Please look in section 275 of the Companies Act, 1956.

A person can be a director in a public limited company as well as in a private limited company. However, as per section 275 of the Companies Act, 1956 a person cannot be a director in more than 15 public limited companies(including private limited companies which are a subsidiary of a public limited company).

There is no such bar in case of private limited companies ( i.e a company which is neither a subsidiary nor a holding company of a public limited company) which means that a person can be a director in any number of pure private companies.

Further, for calculating the said number of 15 companies, the following companies should not be taken in to account:

(i)companies in which the person is appointed as an alternate director;
(ii) An association not carrying on business for profit or which prohibits payment of dividend;
(iii) An unlimited Company

Regards

Archit Sood
BCom ACS LLB.

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