Question

State the following statement is True of False.

The Managing Director is whole time Director of a company.

• A. True
• B. False

Answer 1

The correct option is A True

This statements is True because of the following reasons;

(i) The Companies Act,1956 has defined a Managing Director sections 2(26) as " A Director who by virtue of an agreement with a company or of a resolutions passed by a company in the general meeting or by its Board of Directions or by virtue of its memorandum or articles of association is entrusted with substantial power of management which should not otherwise be exercisable by him and includes a Director occupying the position of Managing Directors ,by whatever name called."

(ii) The Managing Director is the Chief Executive Officer of the company.

(iii) He is appointed by the Board of Directors.

(iv) The Managing Directors executes all decisions taken by the Board as well as the General Body.

(v) He also supervises the performance of the departmental managers.

(vi) The Managing Directors, acts as a representative of the Board.

(vii) he establishes a link between the Board of Directors and other managerial personnel of the company.

(viii) Hence , the Managing Directors is a whole time Director of a company.