Monday, January 7, 2008

What are the rights of a company secretary?

What are the rights of a company secretary?
Rights are given to the secretary by the Companies Act, Board of Directors and the
general meetings of shareholders. He also derives some rights out of his service agreement
with the company. A secretary has the following rights :
(i) He has the right to control and super,vise the working of his department.
(ii) As a principal officer of the company, he has the right to sign a document or
proceeding requiring authentication by the company.
(iii) He has a right to be indemnified by the company for any loss suffered by him
whil.e discharging his duties.
(iv)As an employee of the company, he has the right to receive remuneration. In
the event of winding-up of the company, he has a right to be treated as a
preferential..creditor for his salary, subject to a maximum of Rs. 1,000.
But a company secretary has no right to borrow money in the name of the company
or to make allotment of shares or register transfer of shares without the express
authority or consent of the Board of Directors. He has no authority to convene a
meeting of the company, or to remove a name from the register of members, or to take
policy decisions.
Explain the role of a company secretary in the functioning of a company.
Discuss the role of a ‘Company Secretary’ as a statutory officer and as a corporate
The company secretary plays an important role in company administration.
From the position of a clerk, he has risen to the level of an officer of the company. The
scope of his role depends on the size and nature of the company. He is liable not only
to the company, but also to its shareholders, creditors, employees, consumers, society
and government.
Generally speaking, the company secretary plays a three-fold role-as a statutory
officer, as a co-ordinator and as an administrative officer.
As Statutory Officer
As a principal officer of the company, the company secretary is responsible for strict
compliance with the various provisions of the Companies Act and the requirements
of other Acts. HE!has a very important role to play from the incorporation stage to the
winding up of the company. The secretary is required to make statutory declaration
of compliance at the time of incorporation and commencement of business. He is
responsible for proper maintenance of books of accounts and other registers. He hasto sign several documents such as annual returns, return of allotment, etc

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