Notes On Procedure For Removal Of Company Secretary:

      The legal position of a company secretary may be discussed under the following heads:

1. Servant of the Company:

      A Company Secretary is a servant of the company whose duty is to act as instructed by the Directors of the company. A Secretary cannot act on his own authority. He cannot summon a general meeting, register transfer of shares, and borrow money on behalf of the company unless he is instructed to do so.

2. Agent of the Company:

      Being the chief administrative officer of the company, a Company Secretary also acts as an agent of the company in a rigid sense. He has the authority to enter into contract on behalf of the company regarding matters connected with office administration. As an agent, he must conduct the business with reasonable care and diligence. He shall be liable for any secret profit that he makes in the course of his employment.

      A Company Secretary is an agent in the capacity of a servant and cannot act for the company unless authorised by the Directors.

3. Officer of the Company:

      The Company Secretary is also an officer of the company. As an officer, he may be held liable for the non compliance of the requirements of the Act.

      He may be held liable for default in holding statutory meeting and filing the Statutory Report. He may also be held liable for default in registering certain resolutions and agreements. Furthermore, the Company Secretary may also be held liable for receiving punishment if he falsifies the books of the company or willfully makes a material false statement in the balance sheet of the company.

      Though appointed by the Directors, a Company is not their Servant but an officer of the company with substantial authority in the administrative sphere and with powers and duties delivered directly from the articles and the Companies Act.

Removal of Company Secretary:

      A Company Secretary is a mere servant of the Company, therefore his removal and suspension is governed by the normal law as applicable to master and servant.

      If the Company Secretary is appointed for a fixed term, he cannot be dismissed before the expiry of the term unless he is found he has been proved guilty of misconduct, incompetence etc. Even if he is not appointed for a fixed term, he cannot be dismissed without an agreed notice except in case of misconduct etc. It is also to be noted that in case of winding up of company the appointment of the Company Secretary along with other employees of the company shall be dismissed, but if the Company Secretary has been appointed for a fixed term and the term has not expired on the date of winding up, the Company Secretary has the right to claim for damages for the breach of contract.