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How to Add or Remove a Company Director?


2021-12-12


Adding a Director

Only a general meeting with the consent of the shareholders may add a director to a corporation. As a result, a company's directorship can be changed by adding a director at an annual general meeting or calling an extraordinary general meeting.

It is not always possible to wait for an Annual General Meeting, and it is also not always possible to convene an extraordinary general meeting. In such situations, a business can appoint an extra director during a board meeting and then regularize that director at the next annual general meeting.

Prerequisites of Appointing a New Director;

·         Digital Signature 

·         The director must have a DIN 

·         Consent to act as a director in form DIR-2 

Process of Adding New Director

·         Send notice to directors to call the board meeting 

·         Pass a board resolution to call General Meeting 

·         Send Notice to all the shareholders 

·         Pass resolution in AGM or EGM 

·         File form DIR-12 with MCA 

Appointment of Adding New Director

·         Send notice to directors to call the board meeting 

·         Pass resolution for the appointment 

·         File form DIR-12 with MCA 

·         At the time of AGM, pass a resolution to regularize the additional director 

·         File form DIR-12 with MCA 

Removal of Director

A director can either voluntarily resign or be removed from the board of directors if there is a fair cause. However, in any scenario, the total number of directors must be at least two. If the firm gets a letter of resignation, a board resolution must be passed to make a record of it.

The day on which the company receives the director's notice or the date stated, if any, by the director in the notice, the director is assumed to have resigned. Within 30 days after the resignation, the firm must file a form with MCA.

Conclusion

The corporation exists indefinitely and is unaffected by changes in management or membership. As a result, any change of directors has no impact on the firm. However, any modifications must be reported to the appropriate regulatory authorities. The firm must follow the procedure and submit the appropriate paperwork.