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CS Executive · Company Law and Practice · Key Managerial Personnel and their Remuneration

Under the first proviso to Section 203(1), when can the same individual be appointed as both chairperson (under the articles) and managing director or CEO of a company?

The same person may be chairperson and managing director or CEO only if the articles of the company provide otherwise or the company does not carry multiple businesses. Otherwise the first proviso to Section 203(1) prohibits holding both roles together.

  1. ANever, under any circumstances
  2. BOnly if the articles provide otherwise or the company does not carry multiple businessesCorrect
  3. COnly with a special resolution of members in every case
  4. DOnly if the company is unlisted

Explanation

The first proviso bars one individual from being chairperson and MD or CEO at the same time unless the articles provide otherwise or the company does not carry multiple businesses. It is not an absolute ban, and the proviso does not turn on special resolutions or listing status.

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