CS Executive · Company Law and Practice · Directors
Mr. Rohan Mehta, a director of Kaveri Textiles Ltd, gives the company a written notice of resignation on 10 March, stating that it is to be effective from 1 March. The company receives the notice on 10 March. From what date does his resignation take effect under the Companies Act, 2013?
The resignation takes effect on 10 March. Section 168(2) says it operates from the date the company receives the notice or the date specified in the notice, whichever is later. Since receipt on 10 March is later than the specified 1 March, backdating is not allowed.
- A1 March, the date specified by him in the notice
- B10 March, the date on which the company receives the noticeCorrect
- CThe date on which the Registrar is intimated
- DThe date of the next general meeting
Explanation
Under section 168(2), resignation takes effect from the date the company receives the notice or the date specified in the notice, whichever is later. Here 10 March (receipt) is later than 1 March (specified), so 10 March governs. Taking 1 March ignores the 'whichever is later' rule.
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