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CA Foundation · Business Laws · The Companies Act, 2013

Zenith Motors Ltd, a listed public company, has paid-up share capital of Rs 20 crore. Its board wants to appoint a whole-time Company Secretary as KMP. Which statement is correct under the Companies Act, 2013?

The company secretary is appointed by a resolution of the board of directors, which specifies the terms and conditions including remuneration. A listed company must have a whole-time company secretary, and neither the members nor the Registrar make the appointment.

  1. AThe company secretary can be appointed only by an ordinary resolution of members
  2. BThe company secretary must be appointed by a board resolution, which also sets out the terms and remunerationCorrect
  3. CThe company secretary must be appointed by the Registrar of Companies
  4. DThe company secretary need not be appointed because the company is public

Explanation

A whole-time key managerial personnel, including the company secretary, is appointed by means of a resolution of the board containing the terms and conditions, including remuneration. A listed company is required to have a whole-time company secretary. The members and the Registrar do not make this appointment.

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