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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Empowerment of the Company Secretary Profession

Mahila Millets Producer Company Limited must appoint a whole-time secretary. The board proposes Mr. Rao, a commerce postgraduate with 15 years of experience in cooperative societies, but not a member of any professional institute. Under Section 378X, what is the position?

Mr. Rao cannot be appointed. Section 378X(2) says no individual shall be appointed whole-time secretary unless he is a member of the Institute of Company Secretaries of India. Experience, a special resolution or a board seat cannot replace this membership requirement.

  1. AHe can be appointed, since long experience in cooperatives is an acceptable substitute
  2. BHe can be appointed if the general meeting approves by special resolution
  3. CHe cannot be appointed, because only a person holding membership of the Institute of Company Secretaries of India can be appointed as whole-time secretaryCorrect
  4. DHe can be appointed if he is also a member of the board of the company

Explanation

Section 378X(2) bars appointment of any individual as whole-time secretary unless he is a member of the ICSI. Experience or member approval cannot replace this. Board membership is also irrelevant.

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