New Enroll in RBI Grade B New Batch - Starts on May 21

    Question

    According to the provisions of the Companies Act related

    to independent directors, which of the following statements is correct?
    A An independent director can serve for a maximum of six consecutive years and can be reappointed without any special resolution Correct Answer Incorrect Answer
    B An independent director may hold office for up to two consecutive terms, but cannot be reappointed for another term if three years have not elapsed since ceasing to be an independent director Correct Answer Incorrect Answer
    C An independent director can serve up to five consecutive years, and if reappointed, can hold office for an unlimited number of terms provided each term is approved by a special resolution Correct Answer Incorrect Answer
    D An independent director may serve for two consecutive terms and can be reappointed immediately after the completion of these terms without any restrictions Correct Answer Incorrect Answer
    E An independent director can serve for up to five consecutive years, is eligible for reappointment, and can be associated with the company in any other capacity during the three-year break between terms Correct Answer Incorrect Answer

    Solution

    Section 149. Company to have Board of Director: (10) Subject to the provisions of section 152, an independent director shall hold office for a term up to five consecutive years on the Board of a company, but shall be eligible for reappointment on passing of a special resolution by the company and disclosure of such appointment in the Board’s report. (11) Notwithstanding anything contained in sub-section (10), no independent director shall hold office for more than two consecutive terms, but such independent director shall be eligible for appointment after the expiration of three years of ceasing to become an independent director: Provided that an independent director shall not, during the said period of three years, be appointed in or be associated with the company in any other capacity, either directly or indirectly.

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