Addition or Removal of Director

Appointment (Section 152) and Resignation of Director (168) under Companies Act, 2013

Appointment of Director: Section 152:
Directors in a Company are responsible for the management of their companies affairs, and Board of directors play an important role in governance, setting strategic direction of the companies.

A director is a person who is appointed to perform the duties and functions of a company in accordance with the provisions of The Company Act, 2013.

MINIMUM REQUIREMENTS

Private Limited Company        Minimum 2 Directors
Public Limited Company         Minimum 3 Directors
one person Company              Minimum 1 Director

Documents required as attachments in form:
1. DIR-2(Consent to act as Director of the Company)

2. DIR-8 (Intimation by Director about his interest in other entities and Disqualification under section 164 of the Companies Act, 2013)

3. Letter of Appointment from the company

4. Resolution passed by the Company for his/her appointment(Proposed Director)

Provisions in relation to Additional Director Appointment:

*Additional Director can be appointing by Board of Directors.
*Additional Director can be appointed in Physical or Video Conferencing Board Meeting as well as Circular Resolution.
*Term of additional Director shall be up to next Annual General Meeting
*Additional Director can be regularized in any general Meeting after appointment in Board Meeting.
*Company shall file DIR-12 within 30 days of passing of Board Resolution.
*If additional director not regularized in AGM his tenure cease on the date of AGM.
*After cessation company is required to file e-form DIR-125

PROCEDURE

*Firstly check whether AOA of company contains power to appoint additional director as per section 161(1) of the Companies Act, 2013 otherwise alter the Articles and insert the required provision.

*Secondly check whether such individual have DIN, otherwise apply in DIR-3.

*Call the Board Meeting.

*Pass the board resolution for appointment of Additional Director.

*Documents to be deposited by such individual to the company

DIR-2 – Consent to act as a Director of a Company as per to Rule-8 of Companies (Appointment & Qualification of Director) Rules, 2014
DIR-8- Intimation by Director to the effect that he/she is not disqualified u/s 164(2) of Companies Act, 2013

*File DIR-12 to Registrar of Companies within 30 days from passing Board Resolution.

Attachments for DIR-12 as follows Signed copy of Board Resolution

DIR-2 by such individual
*Also ask for MBP-1- Disclosure of Interest as per Section 184(1) read with Rule 9(1) of Companies (Meetings of Board and its Powers) Rules, 2014 from additional director.

Make sure MBP-1 should not be dated earlier than date of appointment as Director.
Note: Failure to notify the Registrar of one’s appointment as a director is an offence – 
if a director fails to notify the Registrar of his appointment within the 
specified dates as mentioned in the previous paragraph, he is punishable with imprisonment for a period of six months or may have to a pay fine which may extend to fifty thousand rupees and if the non-compliance continues he might have pay an additional fine of rupees five hundred per day of non-compliance.

*Where Company fails to file DIR-12 within specified time then it will be liable to pay additional fee on following basis:

Period of delay                                      Additional Fee
Up to 30 days                                        2 times of normal fees
More than 30 days and up to 60 days   4 times of normal fees
More than 60 days and up to 90 days   6 times of normal fees
More than 90 days and up to 180 days 10 times of normal fees

Resignation of director: Section 168 Companies Act, 2013

A director may resign from his office by giving notice in writing to the company.

Such resignation of a director shall take effect from:

The date on which the Notice Is Received by the company or the Date, If Any, Specified by The Director in the notice, whichever is later.

The Board shall, on receipt of such notice within 30 days intimate the Registrar(ROC) in e-Form DIR-12.

Duty of Director in resignation:
The director shall also forward a copy of resignation along with detailed reasons for the resignation to the Registrar in Form DIR-11 under his/her Digital Signature within 30 days from the date of resignation.

As per section 168 (2), the resignation of a director shall take effect from the date on which the notice is received by the company or the date, if any, specified by the director in the notice, Whichever Is Later.
   
Provided that the director who has resigned shall be liable even after his resignation for the offences which occurred during his tenure.

Note: E-forms to be filed in case Resignation of Director are form DIR.11 and DIR.12.

Filing of Form DIR 11 is the responsibility of resigning director under his/her digital signature and Whereas Filing of Form DIR.12 is the responsibility of Company.

Documents required as attachments:

1. Mention therein the Reason for Resigning(In Form)

2. Enclose the copy of Notice sent to the Company.

3. Enclose Proof Of Dispatch.

4. Resignation letter.

Note: In case of Resignation or Vacation of all the Directors

As per section 168(3) of Companies Act 2013, where all the directors of a company resign from their offices, or vacate their offices under section 167, the promoter or, in his absence, the Central Government shall appoint the required number of directors who shall hold office till the directors are appointed by the company in general meeting.

Where Director fails to file DIR-11 within specified time then he will be liable to pay additional fee on following basis:

Periods of Delay                                     Additional Fee
Up to 30 days                                         2 times of normal fees
More than 30 days and up to 60 days    4 times of normal fees
More than 60 days and up to 90 days    6 times of normal fees
More than 90 days and up to 180 days  10 times of normal fees
More than 180 days                                12 times of normal fees

*Only Individuals can be director.