Under section 196 of the Companies Act, 2013, which arrangement is prohibited even if the appointees otherwise qualify?
Question and options
Under section 196 of the Companies Act, 2013, which arrangement is prohibited even if the appointees otherwise qualify?
Appointing a manager for a term of three years
Employing a managing director and a statutory manager at the same time
Appointing a whole-time director for a term of five years
Reappointing a managing director six months before the current term expires
Answer and explanation
Section 196(1) prohibits a company from having a managing director and a manager at the same time. Section 196(2) limits each term to five years and allows reappointment in the last year of the current term.
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