Second Provisio Of SECTION 149(1) Of Companies act 2013

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  1. WOMEN DIRECTORS

    1) Every listed company and every public company having a paid up share capital of Rs.100 crores or more OR turnover of Rs.300 crores or more shall mandatorily appoint one Woman Director.

    Rule 3 of Companies (Appointment & Qualification of Directors) Rules, 2014 states as follows:

    Provided that a company, which has been incorporated under the Act and is covered under provisions of second proviso to sub-section (1) of section 149 shall comply with such provisions within a period of six months from the date of its incorporation:

    Second proviso to sub-section (1) of section 149 covers appointment of women directors in specified class of companies. The wording of this proviso to Rule 3 is wrong as it should be “within a period of six months from the date of the commencement of the Act”, not date of incorporation.

    There is no uniformity regarding giving time limits for compliances. Sub-section (5) gives a time of one year for compliance of sub-section (4) which is regarding appointment of independent directors, whereas woman directors have to be appointed within six months of the notification.

    Any intermittent vacancy in the Woman Directors should be filled up immediately but not latter than three months from the date of such vacancy or the next Board meeting whichever is latter.

    All listed companies are required to mandatorily appoint woman directors on their Board. Whether the woman directors have to be carved out of the independent directors quota is not clear as also whether the woman director can be part of the promoters. If the latter is true then we will see a lot of wives, daughters, etc. entering into Board positions.

    There is also no provision regarding a registry of woman directors just like the case of independent directors.
     
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