The Companies Act 2013 deals with the Managing Director-related issues in India. A company runs by forming a Board of Directors. However, as per the Companies Act 2013, all the directors cannot be focused on running a company. They appoint a person who works as the Managing Director and who looks after the regular affairs of the company.

However, one mandatory affair is, every company must manage GST return filing, be it online mode or offline mode.

All The Rules Involved with Being A Managing Director

• The minimum age of a Managing Director is 21 years. The maximum age of a Managing Director is 70 years. However, with the Board of Directors’ approval, an MD can be reappointed in the company again. 

• The maximum tenure of an MD is 5 years but as you have read it above, with the approval from the Board of Directors, the Managing Director can extend his/her term.

• The Companies Act 2013 rule says a company cannot appoint a Managing Director and Manager at the same time. 

These are the three basic rules that are associated while appointing a Managing Director as per the Companies Act 2013. A company, be it an LLP, after the completion of LLP Registration, can appoint a Managing Director.

Comparison Between Managing Director and Manager

The Companies Act 2013 says that a Managing Director is a director for sure but a manager cannot always be a director. Even the appointment procedure of the Managing Director and Manager is not the same. The Companies Act 2013, Section 196, Sub-section (1) says that a company cannot have a Managing Director and Manager at the same time. 

However, one similarity between a Managing Director and a Manager is, both of them have to file income tax returns online.

Who Cannot Be Eligible To Be an MD In A Company

However, there are a few legal rules that are associated with being an MD in a company. So, you cannot be an MD overnight.

1.  You are already aware that a person below the age of 21 and above the age of 70 cannot be the MD of a company.

2. A problem with creditors means a person cannot be appointed as the Managing Director.

3. A person who was or who is insolvent at any time cannot be appointed as a Managing Director.

4. A person for any reason was found guilty in the Indian court for any reason. 

5. Imprisoned persons also cannot be the Managing Director of a company.

If a person is in the rule of One to Five, then he/she cannot be appointed as Managing Director. So, after company registration, these rules have to be followed as per the Companies Act 2013.

What about The Rules Associated with Appointing Two MDs in A Company

Section 203 of the Companies Act 2013 depicts you cannot have two managing directors in a particular company. The Companies Act 2013 says that you cannot have two Managing Directors in a particular company. So, even after Private Limited Company Registration, a private company cannot appoint two MDs at the same time.

So, as per the Companies Act rule, you cannot have two MDs in a single company.

Conclusion

So, as per the Companies Act 2013, a person cannot be appointed as Managing Director of two companies at the same time.

So, read the blog attentively to be aware of all the rules that are associated with the appointment of a Managing Director.