Corporate Laws

Directors : Powers of Board of Directors and Personal Rights

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In this article we will study Directors : Powers of Board of Directors and Personal Rights. we will discuss about Powers of company directors, Managing directors according to companies act, 2013 and also discuss their personal rights in a company and Power and rights are required to company Directors.

 

Board of Directors

 

Powers of Board of Directors :

The power of Board of directors  may be grouped under the following heads –

  1. Powers exercisable at the Board meeting.
  2. Powers exercisable with the consent of general meeting.
  3. Powers exercisable with the consent of  the central Government.

Board of Directors

 

(1). Powers exercisable at the Board meeting :

The powers exercisable at the board meeting are classified under two heads are :

(A).  Powers exercisable by majority.

(B). Powers exercisable by unanimous votes.

(A). Powers exercisable by majority vote :-

  In company board of directors shall exercise powers by passing resolution by majority at board meeting.

  • To make calls on shareholders.
  • To authorise  buy-back of securities.
  • To issue securities, including debentures.
  • To borrow monies.
  • To grant loan or give guarantee.
  • To invest the funds of the company
  • To approve financial statements and Boards report.
  • To diversify the business of the company.
  • To approve amalgamation, merger or reconstruct.
  • To make political contributions.
  • To declare interim dividend.
  • To appoint additional directors.

Also Read: Memorandum of Association : Meaning, Features, Importance and Content of Memorandum

(B). Powers exercisable by unanimous vote :- 

The following powers exercised only passed by the board of directors in unanimous resolution at board meeting.

  • To make inter-corporate  loans and investments.
  • To appoint or employ a person as managing director who is already holding office.

(2). Powers exercisable with the consent of General Meeting :

  • To sell, lease or otherwise dispose of the whole or substantially the whole to undertake company.
  • To invest otherwise the securities amount compensate by it as a merger or amalgamation.
  • To borrow money.
  • To give time for the repayment of any debt.
  • To contribute to bona fide charitable and other funds.

(3). Powers exercisable with the consent of the Central Government :

In a company , some time company has no profits to pay  its directors including managing directors, whole time directors or managers by way of remuneration any sum.

 

Personal RIGHTS Of Directors :-

  1. To participate in board meeting.
  2. To get notice of the Board meeting.
  3. To inspect minute book of board meeting.
  4. To inspect books of general meeting.
  5. To inspect books of accounts.
  6. To draw remuneration.
  7. To charge fee for rendering professional services.
  8. To appoint additional member.

 

So we have studied Directors : Powers of Board of Directors and Personal Rights and if you have any queries please let us know in the comments section.

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