Appointment to be approved by Government - Whether, where the section is not attracted to appointment of sole selling agent at the time of entering of agreement, it will be obligatory to comply with the section for continuance of appointment for remaining duration of current tenure - Companies Law - Circular : No. 1/78 [1/1/78‑CL‑V

Circular : No. 1/78 [1/1/78 ‑ CL ‑ V and 12/15/74 ‑ CL ‑ XI], dated 7 ‑ 3-1978. Subject:- Appointment to be approved by Government - Whether, where the section is not attracted to appointment of sole selling agent at the time of entering of agreement, it will be obligatory to comply with the section for continuance of appointment for remaining duration of current tenure A question has arisen whether the approval of the Central Government under sub‑section (2) of section 294AA will be necessary for the continuance of the sole selling agents even if the provisions of the said section to such appointment were not applicable at the time of appointment of the sole selling agents. In this connection, it is clarified that in case of the provisions of section 294AA(2) are not attracted to the appointment of sole selling agents at the time of entering of agreement with them, it will not be obligatory on the companies to comply with the said provisions for the continuance for said appointment for the remaining duration of their current tenure but not during any extension thereof even if the provisions of sub‑section (2) of section 294AA become applicable after the appointment due to the sole selling agents acquiring substantial interest as defined in Explanation under section 294AA.