Article explains Who is a Company Secretary, Who is required to have company Secretary/ KMP, Time Period for such appointment of Company Secretary, Process for appointment of company secretary, Roles and Responsibilities of Company Secretary, Core Duties of the Company Secretary, Appointment of Company Secretary – Offence & Penalty: Section 203(5) and also provides Draft Format of Board resolution: Appointment of Company Secretary.

The Appointment of Company Secretary (CS) has been made mandatory under the Companies Act, 2013 for a few class of the company like listed companies or company having paid-up capital more than the 5 Crore.

Who is a Company Secretary?

A company secretary is a principally an employee even though he holds very high rank. He / She may be the Chief Executive and then his position is near to those of the directors. In reality, he is the only employee who has advisory powers. CS advice is pursued in carrying out general administration and in the decision-making process at the time of framing policies of the company. He is consulted to determine the lawful suggestions of policy decisions. Therefore, he/ she is the only outsider who is present at the Board meetings.

Company Secretary is the person who is a member of the (ICSI) Institute of Company Secretary of India appointed by the company to perform the functions of the Company Secretary.

Who is required to have company Secretary/ KMP?

All listed company and all other company having paid-up share capital of Rs. 5 crore or more shall have whole-time key managerial personnel and shall have following whole-time key managerial personnel namely—

  • MD, or Chief Executive Officer or manager and in their absence, a whole-time director;
  • Company Secretary; and
  • Chief Financial Officer

Time Period for such appointment of Company Secretary:

The Companies Act, 2013 does not provide the period wherein the Company has to designate Company Secretary as (KMP) key managerial personnel. But it is advisable to appoint a Company Secretary as KMP in the first board meeting which is to be conducted after applicability of such a provision.

Process for appointment of company secretary

  • Arrange for Board Meeting only after giving notice to every director to discuss besides others the following matters.
  • Approve the terms and conditions at which the CS is proposed to be appointed.
  • Obtain a written consent from the person who is to be appointed as Company Secretary.
  • Inform the Stock Exchange with which shares of the company are listed on the date of this meeting before the board meeting
  • Inform the said Stock Exchange within 15 minutes of the Board Meeting, of the outcome of the meeting by letter or fax.
  • File the relevant form with fees with the ROC within 30 days from the date of Appointment.
  • Pay the requisite fee for the same.
  • Make necessary entries in the Register of Directors/ Secretary.
  • The ‘whole-time secretary’ indicates that a Company Secretary must be in the employment of the company.

Roles and Responsibilities of Company Secretary

The three main areas, a Company Secretary, has the role to play viz. to the Board, to the Company, and to the Shareholder.

Core Duties of the Company Secretary

  • Meetings of the Board of Directors
  • General Meetings
  • Memorandum and Articles of Association
  • Requirements of Stock Exchanges
  • Statutory Registers
  • Statistical Books
  • Statutory Returns
  • Report and Accounts
  • Registration of Shares
  • Communications to and from Shareholder
  • Issues of Share and Capital and Restructuring
  • Acquisitions, Disposals, and Mergers
  • Corporate Governance
  • Common Seal of the Company etc.

Appointment of Company Secretary – Offence & Penalty: Section 203(5)

If a company contravenes the provisions relating to appointment of whole-time KMP (which includes company secretary), the company shall be punishable with fine which shall not be less than one lakh rupees but which may extend to five lakh rupees and every director and key managerial personnel of the company who is in default shall also be punishable with fine which may extend to one thousand rupees for every day after the first during which the contravention continues.

Draft Format of Board resolution: Appointment of Company Secretary

“RESOLVED  THAT pursuant to provisions of section 203 of Companies act 2013 and Rule 8 and Rule 8A of Companies appointment and remuneration of Managerial Personnel Rules 2014), CS ABC, Company Secretary (ACS/ FCS no …………..) be and is hereby appointed as the whole time Company Secretary of the company with effect from (date) on such terms and conditions as decided and agreed by  and between the Board and Company Secretary.

FURTHER RESOLVED THAT  Mrs XYX director of the Company be and is hereby authorised to file necessary e-forms  and documents with Registrar of the Company and to do all other such acts, deeds and things which are necessary to give effect to above resolution.”

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One Comment

  1. Trupti Ranjan says:

    Sir,
    can i hold post of Treasury head in one Company and Company Secretary in another.

    to explain further – in a group company, am appointed as Manager – Treasury Dept. and in another Company as Company Secretary.

    will it contravene any provision as am whole time Company Secretary in only one Company.

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