In PSUs the CMD is nominated by Government of India and other functional directors and appointed by the President of India.

According to Government notification, a CMD contributing towards turnaround of a sick/loss making company can be given extension of service beyond the date of superannuation.

However, government did not consider the extension inspite of such notifications although the criterias for extension were present. In this regard, a case was filed with Hon' Delhi High Court which passed the judgement in favour of extension of tenure of CMD, and on the basis of the order passed, CMD is continuing his office. Ministry on the other hand, has not given any intimation regarding the appointment or extension of tenure of CMD.

Now what should be the course of action and legality of the position of CMD.

Please give opinion as early as possible.




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