Managerial personnel ‑ Employment ‑ Words “employment” and “appointment” occurring in sections 197A, 267 and 316(1) ‑Interpretation thereof - Companies Law - Letter : No. 8/16(1)/61‑PR,

Letter : No. 8/16(1)/61 ‑ PR, dated 19 ‑ 5 ‑ 1961. Subject:- Managerial personnel ‑ Employment ‑ Words employment and appointment occurring in sections 197A, 267 and 316(1) ‑ Interpretation thereof Query : What is the proper interpretation of the word employment which has been used in addition to the word appointment in (i) section 197A (prohibiting simultaneous appointment or employment or continuation of the appointment or employment of different categories of managerial personnel); (ii) section 267 (debarring certain persons from appointment or employment as the managing or whole‑time director of a company, or debarring continuation of such appointment or employment); and (iii) section 316(1) (which restricts the number of companies, of which one person may be appointed as the managing director). Answer : Appointment is the initial step taken to bring about the stage of employment while employment is a continuing state of relationship. No subtle difference need be drawn between these two terms insofar as the provisions of the Act are concerned. The addition of the word employment was presumably intended to ensure that with the initial act of appointment and the continuing state of employment were brought within the scope of these sections.