Clarifications on Rules prescribed under the Companies Act, 2013 Matters relating to appointment and qualifications of directors and Independent Directors reg.

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....  has  received representations from Industry Chambers, Professional Institutes and other stakeholders seeking clarifications inter alia about  appointment  of Independent  Directors (IDs)  under  the  relevant provisions of the Companies Act, 2013 (Act) read with relevant rules with effect from 1^St April, 2014. The  representations  have  been  examined and clarifications on the following points are hereby given:- (i) Section 149(6)(c): "pecuniary interest in certain transactions" :-  (a) This provision inter alia requires that an 'ID' should have no 'pecuniary relationship' with the company concerned or its holding/ subsidiary/ associate company and certain other cat....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....n in the Board and other meetings and profit related commission approved by the members, in accordance with the provisions of the Act. (ii) Section   149: Appointment of 'IDs' :  Clarification has been sought if 'IDs' appointed prior to April 1, 2014 may continue and complete their remaining  tenure, under the provisions of the Companies Act, 1956 or they should demit office and be re-appointed (should the company so decide) in accordance with the provisions of the new Act. The matter has been examined in the light of the relevant provisions of the Act, particularly section 149(5) and 149(10) & (11).  Explanation to section 149 (11) clearly  provides  that  any  tenure ....