Disqualification Of Director

Question 1

Section 164(2)- what are the clauses under which company should not default?

Answer 1

No person who is or has been director of a company which -
a) has not filed financial statements or annual returns for any
-continuous 3 years
b)has not redeemed or
paid interest
on debentures, deposits
or dividend declared
and if such default CONTINUES FOR ONE YEAR OR MORE

Question 2

What is the proviso - exemption to 164(2)

Answer 2

A director appointed to a company in default under clause a) and b) will not incur disqualification for
6 months
from date of appointment

Question 3

Disqualification under Sec. 164 (2) is for how many years /

Answer 3

Disqualified director shall not be reappointed in that company
or be appointed in any other company
for a period of 5 years
from the day the company defaults

Question 4

S.164 (2) applies to nominee director?

Answer 4

No

Question 5

Can co.have additional disqualifications?

Answer 5

Only PRIVATE Company via articles

Question 6

Do disqualifications continue if appeal is filed against order u/s 164 (1)

Answer 6

Yes

Question 7

When does default under 164 (2) b) become effective

Answer 7

If default continues for 1 yr or more

Question 8

Can a person be convicted under 188

Answer 8

No - not a criminal offence

Question 9

149 - Independent director term of appointment , reappointment and cooling period

Answer 9

term - 1 term upto 5 years
reappointed for one more term - spl reso
cooling period 3 years (during which he is not associated directly / indirectly with the co)

Question 10

Maximum directorship clauses - 165(1)

Answer 10

1. Max.- 20 incld alternate directorships
2. Max 10 - Public cos.
3. Public cos. incld . prvt cos. which are HOLDING OR SUBSIDIARY of public cos.
4. For limit of 20 - dormant cos. not incld

Question 11

Disqualification under 161 (1) for a director?

Answer 11

1. unsound mind declared by competent court
2. applied / undischarged insolvent
3. conviction ( restrictions)
4. order disqualifying him passed by the tribunal or court
5. unpaid calls on shares(in the company where he is proposed to be director) held alone or jointly with others and six months have lapsed since last day fixed for pyt
6. contraventions with other cos act sections

Question 12

provision regarding conviction leading to disqualification under sec. 164 (1)

Answer 12

1. the person is disqualified if he was CONVICTED
   - under an offence involving moral turpitude or otherwise
   - imprisonment not less than 6 months
   - not 5 years have elapsed since expiry of sentence
2. Convicted for offence with imprisonment of 7 yrs or more - PERMANENT DISQUALIFICATION
3. Convicted u/s 188 offence - NOT POSSIBLE

Question 13

Contravention under other sections leading to disqualification

Answer 13

1. Sec. 188 (ONLY IF CONVICTED) - related party
2. Sec. 152 ( Contravention) - DIN
3. Section 165 (CONTRAVENTION) - Overall 20 directorships , 10 public