7. HCQ Pharma Ltd. a company listed with the Bombay Stock Exchange incorporated on January 20, 2002. The Directors of the company want to appoint Mr. Sanjay who is Managing Partner of Sanjay and Associates LLP, firm of Lawyers, as an Independent Director of the
company at the AGM to be held on April 25, 2020. Mr. Sanjay is acting as a legal advisor to Genesis Laboratory Ltd, Associate Company of HCQ Pharma Ltd. Adv. Sanjay charged consultation fees as given below.
Year Fees Gross turnover of Sanjay and Associates
2017-18 2,00,00,000 40,00,00,000
2018-19 10,00,00,000 50,00,00,000
2019-20 0 45,00,00,000
Identify the correct statement from the following:
(a) HCQ Pharma Ltd. can appoint Mr. Sanjay as an Independent Director irrespective of the fact that he is Legal Advisor to its Associate Company.
(b) HCQ Pharma Ltd. cannot appoint Mr. Sanjay as an Independent Director as he is Managing Partner of the firm which is legal advisor to its Associate Company irrespective of the amount of fees charged by the firm to its Associate company.
(c) HCQ Pharma Ltd. cannot appoint Mr. Sanjay as an Independent Director as he is Managing Partner of the firm which is legal advisor to its Associate Company and the fees charged by the firm exceeds the percentage as specified in the act during one out of the three immediately preceding financial year.
(d) HCQ Pharma Ltd. can appoint Mr. Sanjay as an Independent Director even though he is the Managing Partner of the firm which is legal advisor to its Associate Company as the firm did not charge any fees during immediately preceding financial year.
Ans: (c) HCQ Pharma Ltd. cannot appoint Mr. Sanjay as an Independent Director as he is Managing Partner of the firm which is legal advisor to its Associate Company and the fees charged by the firm exceeds the percentage as specified in the act during one out of the three immediately preceding financial year.
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