The Ministry of Corporate Affairs has issued a clarification notification S.O.(E) dated 25.07.2014 with respect to provide clarification in second proviso to sub-section (1) of section 203 of the Companies Act, 2013 which talks about the classes of companies which have appointed one or more chief executive officer as Key Managerial Personnel for multiple business activities, for each such business which has been expressly notified by the Central Government.
The amended provision is contained herein below:
(1) Every company belonging to such class or classes of companies as may be prescribed shall have the following whole-time key managerial personnel,–
(i) managing director, or Chief Executive Officer or manager and in their absence, a whole-time director;
(ii) company secretary; and
(iii) Chief Financial Officer:
Provided that an individual shall not be appointed or reappointed as the chairperson of the company, in pursuance of the articles of the company, as well as the managing director or Chief Executive Officer of the company at the same time after the date of commencement of this Act unless,–
(a) the articles of such a company provide otherwise; or
(b) the company does not carry multiple businesses:
Provided further that nothing contained in the first proviso shall apply to such class of companies engaged in multiple businesses and which has appointed one or more Chief Executive Officers for each such business as may be notified by the Central Government.
For such second proviso the classes of companies are the public companies having a paid up share capital of Rs, 100 crore or more and an average annual turnover of Rs. 1000 crore or more and which are engaged in multiple businesses and have appointed Chief Executive Officers for each such businesses.
The notification containing the above details can also be accessed below:
