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Officer and Officer in Default of a Company

DEFINITION under the Companies Act, 2013 of the terms ‘Officer’ and ‘Officer-in-default’ of a Company incorporated in India is as follows.

OFFICER

Sub-Section (59) of Section 2 defines an Officer - An Officer includes any director, manager or key managerial personnel or any person in accordance with whose directions or instructions the Board of Directors or any one or more of the directors is or are accustomed to act.

OFFICER-IN-DEFAULT

Sub-Section (60) of Section 2 defines an Officer-in-Default - An Officer-in-Default for the purpose of any provision in this Act which enacts that an officer of the company who is in default shall be liable to any penalty or punishment by way of imprisonment, fine or otherwise, means any of the following officers of a company, namely:—


(i) whole-time director;
(ii) key managerial personnel;
(iii) where there is no key managerial personnel, such director or directors as specified by the Board in this behalf and who has or have given his or their consent in writing to the Board to such specification, or all the directors, if no director is so specified;
(iv) any person who, under the immediate authority of the Board or any key managerial personnel, is charged with any responsibility including maintenance, filing or distribution of accounts or records, authorises, actively participates in, knowingly permits, or knowingly fails to take active steps to prevent, any default.”


Important Board Resolution in relation to the above provisions

(1) Board Resolution – Charging of any person with the responsibility of complying any provisions of the Companies Act.

"RESOLVED THAT pursuant to the provisions of Section 2(60)(iv) of the Companies Act, 2013 ____________(name of the employee), _______(designation), who has given his consent in writing in the dated ____ in this behalf, be and is hereby charged with the responsibility of complying with the following provisions of the Companies Act, 2013:

(1) Section _
(2) Section _ 
(3) Section _ 
(4) Section _ 

RESOLVED FURTHER THAT Shri J, Secretary and Shri G, Director be and is hereby severally authorized to sign and submit the Form GNL-3 or such other form(s) as may be necessary to file with the Registrar of Companies to give effect to this resolution."

(2) Board Resolution – Designating Director(s) as Officer in default.

"RESOLVED THAT the Board hereby specifies Shri M, Director and Shri N, Director as Officer in default, in exercise of the powers vested on the Board of Directors under Section 2(60)(iii), for any or all provisions of the Companies Act, 2013 where the expression 'officer who is in default' or an expression which closely resembles it, does occur.

RESOLVED FURTHER THAT Shri J, Secretary and Shri G, Director be and is hereby severally authorized to sign and submit the Form GNL-3 or such other form(s) as may be necessary to file with the Registrar of Companies to give effect to this resolution."

(3) Board Resolution – Revocation/Withdrawal of Consent by the Officer in default.

"RESOLVED THAT the withdrawal of consent by __________(name of the Employee/Director), (Designation) of the Company, who had been charged with the responsibility of complying with the provisions of the Companies Act, 2013 as mentioned in his consent letter, dated _________, is hereby noted.

RESOLVED FURTHER THAT Shri J, Secretary and Shri G, Director be and is hereby severally authorized to sign and submit the Form GNL-3 or such other form(s) as may be necessary to file with the Registrar of Companies to give effect to this resolution."

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