CS Executive · Company Law and Practice · Directors
Mr. Deepak Nair, a director of Zenith Pharma Ltd, gives written notice of resignation. Which statement correctly describes the company's obligations under section 168(1)?
The Board takes note of the written notice, the company intimates the Registrar in the prescribed manner, time and form, and the resignation is mentioned in the report of directors laid at the immediately following general meeting. Section 168(1) requires no shareholder or Board approval for it to be valid.
- AThe Board takes note of the notice, the company intimates the Registrar as prescribed, and the fact is placed in the directors' report laid at the immediately following general meetingCorrect
- BThe resignation is valid only after the general meeting approves it by ordinary resolution
- CThe Board must accept the resignation by special resolution before it is effective
- DThe company need only inform the Registrar and need not mention the resignation in the directors' report
Explanation
Section 168(1) requires the Board to take note on receipt of the notice, the company to intimate the Registrar in the prescribed manner, time and form, and to place the fact of resignation in the directors' report laid in the immediately following general meeting. No approval by members or the Board is required for validity.
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