Tutorial- 5 powers and duties of Special directors

As the name suggests special directors with super special powers. Ordinarily they are not like regular directors , they are special officers deputed by BIFR.

The special directors has the following powers-

i) hold office during the pleasure of the Board (BIFR)  and may be removed or substituted by any person by order in writing by the Board

Means the company even if wants to cannot remove the special director at any time it simply cannot. Just like they said in old indian movies "mere haath bandhe hue h."

(ii) not incur any obligation or liability by reason only of his being a director or for anything done or omitted to be done in good faith in the discharge of his duties as a director or anything in relation thereto;

Means the director do what BIFR asks him to do,  cannot really take loans from the company or give loan.

(iii) not be liable to retirement by rotation and shall not be taken into account for computing the number of directors liable to such retirement;

Generally in every annual meeting there is a procedure according to which the some directors retire every year. However, special director shall not retire in any of the AGM's.

(iv) not be liable to be prosecuted under any law for anything, done or omitted to be done in good faith in the discharge of his duties in relation to the sick industrial company.

Now this point tells you that the special director cannot be sued under any law for anything provided that everything they have done is done in good faith. 

 Thus, simply stated he will inquire about the reasons or say irregularities due to which the company became sick.