In general, there are no restrictions on the nationality of a director. However, the nationality of a director may be a relevant factor in some regulated industries. Directors generally do not need to be resident in the state where the corporation is incorporated. In Sarathi Leasing Finance Ltd v. B Narayana Shetty, (2000) 131 Co. Cases 798, the articles of association authorized the managing director to represent the company in legal proceedings. It was decided that another power of attorney was not required to file a claim for non-cashing of cheques under section 138 of the Negotiable Instruments Act. In a company, the shareholders are the owners because they contribute capital to the operation of the company. But directors are the person responsible for managing the corporation for the purposes for which it was founded. Only certain decisions of paramount importance are made by the shareholders, while the directors are responsible for the entire day-to-day management of the company. If a director is absent from Board meetings for more than 3 months, an alternate director is appointed by the Board of Directors to replace him. The alternate director shall hold office either until the end of his term of office or until the return of the original director.
The difference between ad hoc and alternate administrators is that the alternate director position is temporary until the return of the original administrator, while the ad hoc director position remains permanent. It is also assumed that directors are not full representatives of the corporation because they are elected persons, but persons appointed by agents. A business manager is a professional person hired by the company to manage and manage his business. A director is defined in section 2 (34) of the Companies Act 2013 as a person (director) appointed to the board of directors of a company. No artificial person or entity can be selected for the position of director in a company. Only an individual may be appointed as a director of a corporation. The legal position of the directors is discussed below: I am so satisfied with your notes, it was so easy to understand the whole concept of legal position, especially when the exams are close. This helps me a lot to better understand how the Madras High Court in the landmark case of V.S. Ramaswami Iyer v.
Brahmayya and Co. (1966), directors may be held liable as trustees for their authority to use corporate funds. A director can abuse it in several ways. For this reason, if legal action is brought against a director in respect of the above offence, the cause of action against his or her legal representative remains even after the director`s death. In Percival v. Wright (1902) and Peskin v. Anderson (2001), it was held that directors of a corporation owe their duty to the corporation as a whole and are not trustees of individual shareholders or have a fiduciary duty to them solely by virtue of their duties. They can acquire their shares without disclosing the negotiations on the sale of the company to the company. A person may only be appointed as a director if he or she has been given a Director Identification Number (DIN) or other number in accordance with Section 153 of the Companies Act 2013. According to the 2017 amendment, the central government can give a person an identification number, which must be treated as a DIN for the purposes of this law. The rule that a communication to a representative within his agency is equivalent to a communication to his client.
The same rule applies to administrators. A notice to a director is a notice to the Corporation. As a representative of the Company, the duty of the Director to inform the Company. A « shadow director » is a director who greatly influences the decisions of the company`s board of directors. He does this secretly and acts in the background. He is not officially appointed as a director, but has a great influence on the company`s decisions. An application for the allocation of DIN to the central government must be made by a person who intends to be a director of a company under section 153 of the Companies Act 2013.