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      Question

      As per the Companies Act the conditions under which a

      person is ineligible for appointment as a director of a company ____________
      A A person is disqualified from being appointed as a director if they have been convicted of any offence involving moral turpitude and sentenced to imprisonment for not less than six months, provided that five years have not elapsed since the expiry of the sentence, or if they have been declared an undischarged insolvent Correct Answer Incorrect Answer
      B An individual is not eligible to be appointed as a director if they are of unsound mind as declared by a competent court, have not paid calls on shares held by them for over six months, or have been convicted of an offence related to related party transactions under section 188 within the last five years Correct Answer Incorrect Answer
      C Eligibility for directorship is barred if the person has applied to be adjudicated as an insolvent and the application is pending, or if a court or Tribunal has passed an order disqualifying them from being appointed as a director, provided that the order is still in force Correct Answer Incorrect Answer
      D A person shall be disqualified from being appointed as a director if they have been convicted of an offence under section 188 related to related party transactions in the past five years, or if they have not complied with section 165(1), irrespective of the specific nature of their disqualification Correct Answer Incorrect Answer
      E Ineligibility for directorship applies if a person is an undischarged insolvent, has not complied with the provisions of sub-section (3) of section 152, or has been convicted of any offence involving moral turpitude with a sentence of seven years or more Correct Answer Incorrect Answer

      Solution

      Section 164. Disqualifications for appointment of director: (1) A person shall not be eligible for appointment as a director of a company, if — (a) he is of unsound mind and stands so declared by a competent court; (b) he is an undischarged insolvent; (c) he has applied to be adjudicated as an insolvent and his application is pending; (d) he has been convicted by a court of any offence, whether involving moral turpitude or otherwise, and sentenced in respect thereof to imprisonment for not less than six months and a period of five years has not elapsed from the date of expiry of the sentence: Provided that if a person has been convicted of any offence and sentenced in respect thereof to imprisonment for a period of seven years or more, he shall not be eligible to be appointed as a director in any company; (e) an order disqualifying him for appointment as a director has been passed by a court or Tribunal and the order is in force; (f) he has not paid any calls in respect of any shares of the company held by him, whether alone or jointly with others, and six months have elapsed from the last day fixed for the payment of the call; (g) he has been convicted of the offence dealing with related party transactions under section 188 at any time during the last preceding five years; or (h) he has not complied with sub-section (3) of section 152; (i) he has not complied with the provisions of sub­-section (1) of section 165.

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