Write notes on the following: Removal of Managing Director

Appointment of a Managing or Whole-time director is a contract between him and the company. Removal in breach of contract will entail payment of compensation under Section 202 of the Companies Act, 2013. Further, the appointing authority can only remove him. Hence, he can be removed by the Board or the general meeting depending on whether the Board or the general meeting had appointed him. There is no specific provision for the removal of the Managing/Whole-time director in the Act. If any provisions have been made in the Articles of Association, such provisions shall apply. If the terms and conditions of appointment or re-appointment provide for determination of the office prior to the expiry of the period by either party giving notice of three months or so to the other party, such condition shall be applicable. All conditions applicable to removal of director are also applicable to managing director and whole – time directors and thus Section 168 of the Companies Act, 2013 shall be complied with.