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CMA Final · Corporate and Economic Laws · Board of Directors and Key Managerial Personnel

Which of the following is correct regarding who may sign a contract made on behalf of a company under Section 21?

Under Section 21, a contract or a document requiring authentication may be signed by any key managerial personnel, or by an officer or employee of the company who has been duly authorised by the Board for that purpose. It is not limited to the managing director or company secretary.

  1. AOnly the managing director may sign
  2. BOnly two directors jointly may sign
  3. CAny key managerial personnel, or an officer or employee duly authorised by the BoardCorrect
  4. DOnly the company secretary may sign

Explanation

Section 21 provides that, save as otherwise provided in the Act, documents, proceedings requiring authentication and contracts may be signed by any key managerial personnel or an officer or employee of the company duly authorised by the Board. The other options restrict signatories more than the section does.

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