Directors Removal
Get in Touch to Explore More
The removal of a director from a company in India is governed by the Companies Act, 2013 and its associated rules. This process ensures that companies maintain ethical governance and that directors act in the best interest of the organization.
A director may be removed either by shareholders or by the Central Government, depending on the circumstances.
Modes of Director Removal
1. Removal by Shareholders
a. Shareholders holding not less than 1/10th of the total voting power or at least 100 shareholders holding not less than 1/100th of the total voting power (whichever is lower) may initiate the removal process.
b. A special resolution must be passed with a three-fourths majority of the total voting members present.
c. The director is given a fair opportunity to be heard before the resolution is finalized.
2. Removal by the Central Government
a. The Central Government may remove a director in cases such as:
b. Fraud, misconduct, or misfeasance in connection with the company.
c. Disqualification under the Companies Act, 2013.
d. Failure to act in accordance with statutory responsibilities or ethical standards.
Procedure for Removal of Director
1. Board Meeting:
A notice is issued to convene a board meeting to discuss the proposed removal.
2. Notice to Director:
The concerned director must receive a written notice and be given an opportunity to present their case.
3. General Meeting:
A general meeting is held where shareholders vote on the resolution to remove the director.
4. Filing with ROC:
Once approved, the company must file Form DIR-12 with the Registrar of Companies (ROC) within 30 days of removal.
5. Update in Records:
The company’s internal records, digital signatures, and bank authorizations should be updated to reflect the change.
Legal Compliance
1. Comply with Section 169 of the Companies Act, 2013.
2. Ensure proper documentation and minutes of meetings are maintained.
3. Provide the director with a reasonable opportunity to defend before removal.
Key Points to Remember
1. Removal must follow due legal process.
2. Directors cannot be removed arbitrarily.
3. Non-compliance can lead to penalties or reinstatement orders from the tribunal.
4. Professional assistance ensures transparency and legality.
How xLegal Helps
At xLegal, our team of company law experts assists in the entire director removal process, including:
1. Drafting board and shareholder resolutions.
2. Filing necessary forms with the ROC.
3. Ensuring compliance with the Companies Act.
4. Providing legal documentation and procedural guidance.
We ensure a smooth, compliant, and conflict-free transition for your company.
Documents Required
1. Director’s DIN and PAN
2. Board Meeting Notice and Resolution
3. Shareholder Resolution Copy
4. Proof of Communication with Director
5. Updated List of Directors
6. Incorporation Documents (MOA & AOA)
Why Choose xLegal
1. Expert legal support from company law professionals.
2. 100% online and hassle-free process.
3. Fast turnaround time with guaranteed compliance.
4. Dedicated case manager for personalized assistance.
Need expert assistance? xLegal Team provides end-to-end support for this, Contact us at +91 9319661668, info@xlegal.in