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CMA Final · Corporate and Economic Laws · Inspection, Inquiry and Investigation

Ramesh, a director of Kaveri Ltd, is convicted of an offence of disobeying an inspector's direction under the section on conduct of inspection and inquiry. What is the consequence for his office?

On conviction, the director is deemed to have vacated his office from the date of conviction and is disqualified from holding an office in any company, not just the company concerned. No waiting for a general meeting or limited suspension applies.

  1. AHe is suspended for one year only
  2. BHe continues in office until the next general meeting
  3. CHe is deemed to have vacated office from the date of conviction and is disqualified from holding office in any companyCorrect
  4. DHe vacates office only in Kaveri Ltd and may join other companies

Explanation

Section 207(4)(ii) deems the convicted director or officer to have vacated office from the date of conviction and disqualifies him from holding an office in any company. The disqualification is not limited to Kaveri Ltd.

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