LEGAL POSITION OF DIRECTORS

1. DIRECTORS –
APPOINTMENT,POWER AND
LEGAL POSITION

2. DIRECTOR
 A DIRECTOR IS A PERSON WHO IS
RESPONSIBLE FOR DIRECTING
OR CONTROLLING THE POLICY
OR MANAGEMENT OF A COMPANY.

3. BOARD OF DIRECTORS
 The ‘BOARD’ is the apex governing
body of a company. A company board
is its ‘brain’, all the companies actions
are planned by its Board.

4. Qualification of Directors
 A director must acquire the
qualification shares.
 A director must give written consent.
 Only individuals can be directors.

5. Number of Directors
 A public company shall have at least
three directors.
 Every other company shall have at
least two directors.

6. Appointment of Directors
 By the Signatories of Memorandum of
association
 By the Shareholders in the General
Meeting
 Appointment by Board of Directors
 Appointment by Proportional
Representation
 Appointment by Third Parties
 Appointment by Central Government

7. Legal Position of Directors
 Directors as a Trustee
 Directors as Agents of Company
 Directors as a Managing Partner of
the Company
 Directors as an Officer of the
Company
 Directors as an Employee of the
Company

8. Vacation of Office by
Directors
 On not Taking Qualification Shares
 On being Adjudged of Unsound Mind
 On being Adjudged as Insolvent
 On being Imprisoned
 On Removal from Office
 On becoming Disqualified

9. Powers of Directors or Board of
Directors
General Powers
 Inspect the books of account of the
company
 Issue notices of the company’s meetings
 Receive his remuneration
 Attend the meetings of the company’s
Board of Directors
Specific Powers
 Issue debentures
 Invest the funds of the company
 Make loans on behalf of the company

10. Duties of Directors
 Inspecting the Prospectus
 Signing the Prospectus
 Presenting the Annual Statement
 Holding the Statutory Meeting and
Forwarding the Statutory Report
 Convening of General Meeting
 Declaring and Paying Dividend
 Presenting the Annual Accounts
 Sending Copies to Registrar

11. Liabilities of Directors
Liability Towards Company
 Liability of Ultra- Vires Acts
 Liability for Negligence
 Liability for Fraud
Liability Towards Outsiders
 Liability for Ultra- Vires Acts
 Liability as Agents
 Liability in Relation to Allotment

12. Thanks…