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No public company or private company which is a subsidiary of a public company can, appoint or employ any person as managing director, of he is either the managing director or the manager of any other company, except as provided below.

A public company or a private company which is the subsidiary of a public company may appoint or employ a person as its managing director, if he is the managing director or manager of one, and of not more than one, other company provided that such appointment or employment is made or approved by a unanimous resolution passed at a meeting of the Board and of which meeting, and of the resolution to be moved thereat, specific notice has been given to all the directors then in India.

In addition to the above provision, the Central Government may, by order, permit any person to be appointed as a managing direct of more than two companies if the Central Government is satisfied that it is necessary that the companies should, for their proper working, function as a single unit and have a common managing director.

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