{"id":5759,"date":"2019-04-26T12:37:09","date_gmt":"2019-04-26T07:07:09","guid":{"rendered":"http:\/\/carajput.com\/blog\/?p=5759"},"modified":"2021-10-13T01:32:38","modified_gmt":"2021-10-12T20:02:38","slug":"corporate-and-professional-updates-on-26th-april-2019","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/","title":{"rendered":"All About Key Managerial Personnel under Co Act 2013"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69eaa4f01ceec\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69eaa4f01ceec\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Complete_understanding_about_Key_Managerial_Personnel\" title=\"Complete understanding about Key Managerial Personnel\">Complete understanding about Key Managerial Personnel<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Brief_Introduction\" title=\"Brief Introduction\">Brief Introduction<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Scope_of_Key_Managerial_PersonnelKMP\" title=\"Scope of Key Managerial Personnel(KMP)\">Scope of Key Managerial Personnel(KMP)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Appointing_Requirement_of_KMP\" title=\"Appointing Requirement of KMP\">Appointing Requirement of KMP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#KMP_as_Director_of_Other_Company\" title=\"KMP\u00a0as Director of Other\u00a0Company\">KMP\u00a0as Director of Other\u00a0Company<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Vacancy_in_Key_Managerial_Personnel\" title=\"Vacancy in Key Managerial Personnel\">Vacancy in Key Managerial Personnel<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Procedure_for_Appointment_of_KMP\" title=\"Procedure for Appointment of KMP\">Procedure for Appointment of KMP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Maintenance_of_Register_of_KMP\" title=\"Maintenance of Register of KMP\">Maintenance of Register of KMP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Roles_and_Responsibility_of_KMP\" title=\"Roles and Responsibility of KMP\">Roles and Responsibility of KMP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Disqualifications_of_KMP\" title=\"Disqualifications of KMP\">Disqualifications of KMP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Penal_Provisions_related_to_Key_Managerial_Personnel\" title=\"Penal Provisions related to Key Managerial Personnel\">Penal Provisions related to Key Managerial Personnel<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-updates-on-26th-april-2019\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-17461\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/KMP.-300x125.jpg\" alt=\"KMP\" width=\"938\" height=\"394\" \/><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Complete_understanding_about_Key_Managerial_Personnel\"><\/span><span style=\"color: #ff0000;\"><strong>Complete understanding about Key Managerial Personnel<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3><span class=\"ez-toc-section\" id=\"Brief_Introduction\"><\/span><span style=\"color: #000080;\"><strong>Brief Introduction<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>A new concept of Key Managerial Personnel \u00a0was introduced under the Companies Act,2013.\u00a0This idea\u00a0is essentially\u00a0for bringing all the heads into one main head as\u00a0all of them\u00a0are\u00a0a part of\u00a0the corporate.\u00a0because the\u00a0board of directors set goals and objective of\u00a0the corporate. But KMPS play important role\u00a0within the\u00a0day-to-day activity of\u00a0the corporate\u00a0and helps in achieving the goal of\u00a0the corporate. Section 2(51) of\u00a0the companies\u00a0Act,2013 provides the legal definition of \u201cKey Managerial Personnel\u201d.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Scope_of_Key_Managerial_PersonnelKMP\"><\/span><span style=\"color: #000080;\"><strong>Scope of Key Managerial Personnel(KMP)<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><strong>Key Managerial Personnel means<\/strong><\/p>\n<ul>\n<li>CEO, MD, or Manager.<\/li>\n<li>Company Secretary.<\/li>\n<li>Whole Time Director.<\/li>\n<li>Chief financial officer.<\/li>\n<li>Any other officer, being one level below the Whole-time director, and<\/li>\n<li>Such other officer as prescribed.<\/li>\n<\/ul>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-17458\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Key-Managerial-Personnel-300x169.jpg\" alt=\"Key-Managerial-Personnel\" width=\"1244\" height=\"700\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Key-Managerial-Personnel-300x169.jpg 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Key-Managerial-Personnel-768x432.jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Key-Managerial-Personnel-800x450.jpg 800w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Key-Managerial-Personnel.jpg 1024w\" sizes=\"(max-width: 1244px) 100vw, 1244px\" \/><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Appointing_Requirement_of_KMP\"><\/span><span style=\"color: #000080;\"><strong>Appointing Requirement of KMP<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-17459\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Appointment-of-Key-Managerial-Personnel-1-300x149.jpg\" alt=\"Appointment-of-KMP\" width=\"842\" height=\"418\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Appointment-of-Key-Managerial-Personnel-1-300x149.jpg 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Appointment-of-Key-Managerial-Personnel-1-768x382.jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Appointment-of-Key-Managerial-Personnel-1-800x398.jpg 800w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/04\/Appointment-of-Key-Managerial-Personnel-1.jpg 893w\" sizes=\"(max-width: 842px) 100vw, 842px\" \/><\/p>\n<p>As per section 203 of Companies Act,2013 along with the rule 8 of companies\u00a0Rules, 2014,\u00a0the subsequent\u00a0class of\u00a0the corporate\u00a0would be required to compulsorily appoint KMP:<\/p>\n<ul>\n<li>Every Listed Company<\/li>\n<li>Public Company, Paid-Up Capital 10 crore or more<\/li>\n<\/ul>\n<p>Apart from this, rule 8A of Companies Rules,2014 provides that the company having paid-up capital of more than equal to Rs. 10 crores, is mandatorily required to appoint a whole-time company secretary in their Board of Directors.<\/p>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"KMP_as_Director_of_Other_Company\"><\/span><span style=\"color: #000080;\"><strong>KMP\u00a0as Director of Other\u00a0Company<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>KMP will obtain permission from the board for being the director of\u00a0the other\u00a0company. Permission\u00a0are\u00a0granted by the board\u00a0within the\u00a0committee meeting. And if permission is given then\u00a0it&#8217;ll\u00a0be told\u00a0to all\u00a0the directors\u00a0of\u00a0the corporate. If the board\u00a0doesn&#8217;t\u00a0grant the permission then he\u00a0can not be\u00a0the director of\u00a0the other\u00a0company.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Vacancy_in_Key_Managerial_Personnel\"><\/span><span style=\"color: #000080;\"><strong>Vacancy in <\/strong><\/span><span style=\"color: #000080;\"><strong>Key Managerial Personnel<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>In case, the office of any KMP, stands vacant, then the same shall be filled up within 6 months from the date of arising of such vacancy.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Procedure_for_Appointment_of_KMP\"><\/span><span style=\"color: #000080;\"><strong>Procedure for Appointment of KMP<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>KMPs are required to be appointed, as per the provisions of section 203 of\u00a0companies\u00a0Act, 2013. Such an appointment shall be made by passing of resolution by the board of directors of the said entity. Also, the appointment letter of such a KMP shall mention the terms and conditions of appointment along with the details of their remuneration.<\/li>\n<li>If\u00a0there&#8217;s\u00a0a vacancy\u00a0it&#8217;s\u00a0to be filled within 6 months of such vacancy.<\/li>\n<li>In case corporate violates the supply of appointment of managerial personnel, the corporate needs to suffer a penalty. Fine are of 1 lakh rupees which can extend upto 5 lakh rupees.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Maintenance_of_Register_of_KMP\"><\/span><span style=\"color: #000080;\"><strong>Maintenance of Register of KMP<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>The company\u00a0which can\u00a0be falling under\u00a0the supply\u00a0of Key Managerial Personnel is required\u00a0to keep up\u00a0a register. Such a register shall contain the particulars of\u00a0the directors\u00a0and KMPs and same shall be placed at the registered office address of\u00a0the corporate entity.<\/li>\n<li>The document includes information on securities held by them\u00a0within the\u00a0company or its holding, subsidiary of a\u00a0company\u00a0or associate company.<\/li>\n<\/ul>\n<p>Also Read :\u00a0<strong><span style=\"font-size: 13.5pt; line-height: 107%;\"><a href=\"https:\/\/carajput.com\/blog\/due-date-for-annual-return-of-company\/\">Statutory due dates for Company annual filing<\/a> for FY 2020-21<\/span><\/strong><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Roles_and_Responsibility_of_KMP\"><\/span><span style=\"color: #000080;\"><strong>Roles and Responsibility of KMP<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>The KMPs are chargeable for non-compliance of the provisions provided under the companies Act,2013.<\/li>\n<li>Management functions and therefore the decisions of the corporate are the responsibility of the KMPs.<\/li>\n<li>As per section 170, detailed information of securities are going to be provided by KMPs and recorded within the register of the corporate.<\/li>\n<li>In the audit committee, the correct to heard are provided to KMPs while considering the audit report. But they don\u2019t have the proper to vote.<\/li>\n<li>According to section 189(2), KMPs are required to disclose their concerns and interest, within 30 days from the date of their appointment.<\/li>\n<\/ul>\n<p>Also, read Blogs: <a href=\"https:\/\/carajput.com\/blog\/mca-proposes-change-in-process-of-obtaining-fresh-director-identification-number\/\">Process of obtaining fresh DIN<\/a><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Disqualifications_of_KMP\"><\/span><span style=\"color: #000080;\"><strong>Disqualifications of KMP<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Section 196(3) of\u00a0the companies\u00a0Act,2013 states that\u00a0an organization\u00a0shall not appoint or continue\u00a0the utilization\u00a0of a\u00a0managing director, whole-time director, or manager if such person:<\/p>\n<ul>\n<li>Not completed age of 21years or exceeds 69 years of age.<\/li>\n<li>Uncharged insolvent or adjudged insolvent person.<\/li>\n<li>Record of holding payments from creditors.<\/li>\n<li>Convicted by the court for an offence punished with imprisonment for quite 6 months.<\/li>\n<li>Not appointed for quite 5 years at a time.<\/li>\n<li>Detained under the contravention of Prevention of Smuggling Activity Act,1974.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Penal_Provisions_related_to_Key_Managerial_Personnel\"><\/span><span style=\"color: #000080;\"><strong>Penal Provisions related to Key Managerial Personnel<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>If\u00a0an organization\u00a0breaches\u00a0the provision\u00a0of section 203, then\u00a0the corporate\u00a0should\u00a0pay a penalty of Rs. 5 lakh.<\/li>\n<li>In case Director or KMPs breaches the availability, then they need to pay a penalty of Rs. 50,000. In case the default continues, the said person would be liable for a penalty of Rs. 1000 per day of default.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><span style=\"color: #000080;\"><strong>Conclusion<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>The KMP plays\u00a0a really\u00a0important role\u00a0within the\u00a0company. As they work for the day to day operation of\u00a0the corporate\u00a0so, that\u00a0the target\u00a0of\u00a0the corporate\u00a0is achived.<\/li>\n<li>The ministry of corporate affairs and security exchange made the compulsory appointment of the KMP\u00a0within the\u00a0company.\u00a0and supply\u00a0the actual\u00a0law for the appointment of KMP in companies Act,2013. So, that company can operate\u00a0within the\u00a0spirit of the law<\/li>\n<\/ul>\n<p>Read Also : <a href=\"https:\/\/www.caindelhiindia.com\/blog\/complete-understanding-llp-compliances\/\">LLP Compliance\u00a0<\/a><\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"vVZAYOU48l\"><p><a href=\"https:\/\/www.caindelhiindia.com\/blog\/complete-understanding-llp-compliances\/\">COMPLETE UNDERSTANDING LLP COMPLIANCES<\/a><\/p><\/blockquote>\n<p><iframe class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;COMPLETE UNDERSTANDING LLP COMPLIANCES&#8221; &#8212; India Financial Consultancy\" src=\"https:\/\/www.caindelhiindia.com\/blog\/complete-understanding-llp-compliances\/embed\/#?secret=vVZAYOU48l\" data-secret=\"vVZAYOU48l\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<p>&nbsp;<\/p>\n<ul style=\"text-align: justify;\">\n<li><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Complete understanding about Key Managerial Personnel Brief Introduction A new concept of Key Managerial Personnel \u00a0was introduced under the Companies Act,2013.\u00a0This idea\u00a0is essentially\u00a0for bringing all the heads into one main head as\u00a0all of them\u00a0are\u00a0a part of\u00a0the corporate.\u00a0because the\u00a0board of directors set goals and objective of\u00a0the corporate. But KMPS play important role\u00a0within the\u00a0day-to-day activity of\u00a0the corporate\u00a0and &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[18],"tags":[10022,9156],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/5759"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=5759"}],"version-history":[{"count":4,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/5759\/revisions"}],"predecessor-version":[{"id":17462,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/5759\/revisions\/17462"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=5759"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=5759"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=5759"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}