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Can the KMP of Holding Co. be appointed in only one subsidiary or in all subsidiaries of holding company at the same time?

Can the KMP of Holding Co. be appointed in only one subsidiary or in all subsidiaries of holding company at the same time?

No, as per section 203(3) of the Companies Act, 2013,a Whole-time KMP of a company shall not hold office in more than one company except in its subsidiary company.

Companies Act, 2013 (Act) has introduced many NEW CONCEPTS AND KEY MANAGERIAL PERSONNEL is one of them. While the Companies Act, 1956 recognised only Managing Director, Whole Time Director and Manager as the Managerial Personnel, the Companies Act, 2013 has brought in the concept of Key Managerial Personnel which not only covers the traditional roles of managing director and whole time director but also includes some functional figure heads like Chief Financial Officer and Chief Executive Officer etc. These inclusions are in line with the global trends.

Key management personnel are employees who have the authority to directly or indirectly plan and control business operations. The term key management personnel is a relative term dealing with specific operations.


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