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Appointment/Removal of Director

Is there a need to add or remove director in your company?
We are here to guide you through the formalities as per company law.

Appointment/Removal of Director | Complete Guidance

Consult us for the complete procedure of Appointment / Removal of Director in a very simpler and easier process at a Cost effective Price from the Nation’s Experts.


What is Appointment/Removal of Director?

According to the Companies Act, only an individual can be appointed as a member of the board of directors. They control, direct and administer the entire company’s business. Change of directors takes place – either by appointing a new director or by removing an existing director. The process of change of directors should always be handled by experts having the best interest of the company.


Appointment/Removal Of Director

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Procedure for Appointment of Director


  • DSC: Acquiring Digital Signature Certificate.
  • DIN: Obtaining Director ldentification Number.
  • Documents Preparation: Preparing all required documents pertaining to the appointment of the director.
  • Board Meeting: Hold Board meeting and pass a resolution for appointment of director.
  • Filing: File the relevant E-form with the Registrar of companies within 30 days of appointment of director.

Procedure for Removal of Director


  • Special Notice: A Special Notice of the intension to move a resolution for the removal of director should be furnished by a member and same be sent to the director proposed to br removed.
  • Board Meeting: Hold Board meeting and pass a resolution to call for a general meeting.
  • Issue Notice: Issue notice of general meeting informing about the special notice and proposing the ordinary resolution for removal of director.
  • General Meeting: Hold and convene a general meeting and pass the ordinary resolution for the removal of director.
  • Filing: File E-FORM 12 with Registrar of companies within 30 days of passing the resolution.

Documents Required



Passport Photo

Copy of PAN Card

DSC

Mobile/Email

Copy of Aadhar Card

Address Proof Director/Partner (Bank Statement / Mobile / Telephone Bill)

DIN

Consent Letter

Why Add/Change Directors

To get new talent on board

1

No dilution of ownership

2

Inefficiency of existing directors

3

Resignation or Removal of Director


Director is entrusted with the powers of management and administration of the Company. Outgoing Director can either resign or can be removed from the Company by following the due procedure of law. In such cases, a Director can resign or be removed by filing the intimation of change of Director with MCA.The procedure for resignation of director and removal of Director by the Board or Shareholders vary. Outgoing Director can resign by giving a simple resignation letter in writing to the company and the Company shall file the necessary documents and e-forms with MCA within 30 days.

Choose Package

Addition of One Director to BOD

₹ 1,999

  • Obtain DIN
  • Add One Director having DSC to the Board of Directors.

Request Callback

Removal/Resignation of One Director

₹ 1,999

  • Resignation of a Director from the Board of Directors /Resignation by Director.

Request Callback


Under section 164 of the act, the following disqualifications are provided:

  • Unsound mind person
  • Undischarged insolvent
  • Convicted by the court
  • Order of disqualifying passed by the court
  • Not paying any call for the shares of the company
  • Convicted for an offence
  • Not filled any financial statements
  • Failed to repay the deposits
  • Barred by law

Different Categories of Directors

  • Executive director
  • Non-executive director
  • Managing director
  • Independent director
  • Residential director
  • Small shareholder director
  • Women director
  • Additional director
  • Alternate director
  • Nominee director

Who is Eligible to Become a Director in the Company?

According to the Companies Act, only an individual can be appointed as a member of the board of directors. Usually, the appointment of directors is done by shareholders. A company, association, a legal firm with an artificial legal personality cannot be appointed as a director. It has to be a real person.

Type of company No. of Director required
One Person Company 1
Private Limited Company 2
Public Limited Company 3

A company can appoint Maximum 15 Directors (If company want to appoint more than 15 directors Special Resolution Required to pass in General meeting)- Procedure {Simple Process of Holding of Extra-Ordinary General Meeting, which we use in other Matters also).

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FAQ

  How much time is needed fir appointment or removal of directors?
Appointment/Removal or Resignation of Director usually takes 1-2working days subject to the approval of the Central Govt. and the receipt of documents from the clients.
  Who can exercise the right of removing a director from a company?
The shareholders of a company may pass an ordinary resolution:

  • A) to remove the director of the company; or
  • B) to appoint someone in place of a director so removed;

before the expiry of the period of his office after giving him a reasonable opportunity of being heard.

  Does shareholders has the right available for removing of any kind of director?
No, the Act does not allow removing a director who has been appointed by the National Company Law Tribunal (“Tribunal”) under Section 242 of the Act, which deals with right of appointment of director by the Tribunal in case of oppression or mismanagement.
  What are the rights of a director who is being removed by giving special notice?

  • A) The concerned director is entitled to be heard on the resolution at the meeting.
  • B) If the concerned director makes a representation in writing to the company and requests that the same be notified to the members of the company;
    If there is sufficient time, company shall:

  • C) state the fact of the representation having been made in the notice circulated to members; AND
  • D) send a copy of representation to all the members (whether before or after receipt of the representation by the company)
  • If there is insufficient time/ due to default of the company:
  • E) the director may require that the representation shall be read out at the meeting
    On the application of the company/ aggrieved person, if the Tribunal is satisfied that the rights conferred are being abused to secure needless publicity for defamatory matter, then the representation need not be read out.
  • The Tribunal may order the company’s costs on the application to be paid in whole / part by the director whether or not that he is not a party to it.

  What is the procedure to fulfil the vacancy created on removal of director?
If the special notice provided by the members specifies intention of appointment of new director in place of director being removed, then the vacancy created by removal of director can be filled as per such notice.However, if the vacancy is not so filled, then it may be filled as a casual vacancy in accordance with the provisions of the Act.
  Can a director who was removed from office be reappointed as a director by the Board of Directors?
No
  In how many company a person can become the director?
Number of directorships- Section 165 Maximum number of directorships, including any alternate directorship a person can hold is 20. It has come with a rider that number of directorships in public companies/ private companies that are either holding or subsidiary company of a public company shall be limited to 10.
  Is it mandatory to have resident director in a company?
Section 149 (3) of the Act has provided for residence of a director in India as a compulsory i.e. every company shall have at least one director who has stayed in India for a total period of not less than 182 days in the previous calendar year.
  What is the Age limit to become for the Directors?
To become a director of the company there is no specified age limit. However, sec 157 of the company act provides minimum age to be 21 years. Any person with less than 21 years of age cannot become the company’s head.
  Can an Indian ocompany appoint an NRI or Foreigner as the director?
Yes a company can appoint NRI or foreigner as the director of the company. To appoint an NRI or foreigner, it is mandated to have atleast one Indian resident Director on board.
  Which form is required to be filed for appointing a new director?
For appointing a new director e-Form DIR 12 is to be filed.

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