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What is basic qualification to become Managing Director of a company?
According to the Company Law(India) the following cannot be appointed as managing of a company
- A person who is an undischarged insolvent or has at any time been adjudged insolvent.
- A person who suspends or has at any time suspended, payment to his creditors or makes or has made a composition with them.
- A person who is or has been convicted by a court of an offense involving moral turpitude. Any person convicted for violating them and sentenced to imprisonment or fine up to Rs 1000 shall not be appointed without the approval of the Central Government.
A person who is already a managing director of another company he can be appointed only with the unanimous resolution of the board of directors. The Central Government may permit Any person to be appointed managing director of more than two companies if the Government is satisfied that it is necessary that the companies should, for their proper working, function as a single unit and have a common managing director.
There are some restrictions on maximum term of appointment also.
It is an essential requirement of "managing director" that he/she should hold the office of a director. A managing director who is not a director is contradiction in terms.
The MD is usually the senior executive director and responsible for overall operations and performance of the company.
For more and accurate details please refer the Company Laws.
Please Note: This answer is just our view and a suggestion
only. We have used our best knowledge but still the information may not be 100% accurate and updated.