Anonymous
Asked June 28, 2016

Managerial person of a company to be Director for another company

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Can a Key Managerial Personnel (KMP) of one company be the director of another company?

Answer 1

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Anonymous

Key Managerial Personnel (KMP) has been defined under Section 2(51) of Companies Act, 2013 which says that; key managerial personnel means

  • The Chief Executive Officer or the managing director or the manager;
  • The company secretary;
  • The whole-time director;
  • The Chief Financial Officer; and
  • Such other officer as may be prescribed;
  • As per Section 203(3) a whole-time Key Managerial Personnel shall not hold office in more than one company. The Section further says that that  a KMP cannot be dis-entitled from being a director of any company and needs to take permission from the Board to be a Director in another Company.

    The KMP will have to choose one company in which he wishes to continue as a KMP within a period of six months. After the expiry of six months he/she can  continue as the KMP of only one Company  and can continue being a Director in the other companies.

    Agree Comment 0 Agrees about 1 year ago

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