Removal of Director

Overview

A company may remove a director before expiry of the period of his office by passing ordinary resolution in general meeting. Before removal of director a reasonable opportunity of being heard shall be given to him. A company cannot remove directors appointed by the Tribunal u/s 242.

WAYS OF REMOVAL OF DIRECTOR

The director of the company can be removed in following ways:

• Removal by the members or board of the company.
• Resignation by director himself.
• Vacation of office of director when he does not attend any board meeting during a period of 12 months.
• Removal of director by the NCLT.

PROCEDURE FOR REMOVAL OF DIRECTOR BY MEMBER

• STEP-1: Receipt of Special Notice: A special notice is received by the company from the member of the company for removal of director.
• STEP-2: Intimation to the Director: On receipt of notice of a resolution to remove a director, the company shall forthwith send a copy of the special notice to the director who is proposed to be removed.
• STEP-3: Convene Board Meeting: Meeting of Board of Directors of the company shall be conducted after giving notice for passing resolution to:
  • Remove director subject to its approval in general meeting.
  • Approve the notice of general meeting after fixing time, date and venue of general meeting.
  • Authorize director or any other person to issue the notice of general meeting on behalf of the board.
• STEP-4:Send 21 days clear notice of the meeting to every member of the company along with a copy of the representation if any made by the director proposed to be removed.
• STEP-5: Hold General Meeting: Hold general meeting of the company for passing ordinary resolution for removing director of the company. Before removal of the director an opportunity of being heard shall be given to the concerned director.
• STEP-6: Intimation to Registrar: After removal of directors the particulars of director removed is required to be filed with ROC in form DIR-12 with the requisite fees and required documents.

RESIGNATION BY DIRECTOR

A director of the company may resign voluntarily after giving notice to the company in this respect. The period of notice as may be agreed between him and the company. The director is required to intimate ROC about his resignation.

PROCEDURE RESIGNATION BY DIRECTOR

• STEP-1: Notice of Resignation:- The director of company may resign by giving written notice of resignation to the company.
• STEP-2: Convene Board Meeting:- The company shall conduct board meeting for passing resolution to
  • Take note of resignation of the Director.
  • Authorise any person to file resignation of director with the ROC in prescribed form.
• STEP-3: The director who resigned from his office may file his resignation along with reasons of resignation in form DIR-11 within 30 days of resignation.
• STEP-4:The Company is required to intimate Registrar in form DIR-12 about the resignation of director within 30 of resignation.
• STEP-5: After filing of forms with Registrar the name of director will be removed from the database of company maintained on MCA website. And company also remove the name of director from the register of director maintained by it.

ATTACHMENTS OF DIR-11

• Notice of resignation.
• Proof of sending notice to the company.
• Acknowledgement received from company, if any.

DOCUMENTS REQUIRED

• DSC of the director.
• DIN of the director.
• Notice of resignation.

VACATION OF OFFICE BY DIRECTOR

As per the Companies Act, 2013 a director of company shall vacate his office if he does not attend any meeting of Board of Directors during a period of 12 months either with or without seeking leave of absence and there are several other conditions are also mentioned in the act for vacation of office by a director. In this case also company is required to file form DIR-12 to intimate Registrar.

REMOVAL OF DIRECTORS BY THE TRIBUNAL

The director of the company may be removed by the National Company Law Tribunal if it receives application u/s 241 of the Companies Act, 2013. The Tribunal has power to remove any director u/s 242(2)(h) of the act.

GOVERNMENT FEES

1. Fee for filing e-Form in case of company have share capital

2. Fee for filing e-Form in case of company not have share capital: Rs. 200 per document

Penalty: