• Removal Of Director

Streamline Your Board: Remove Directors with Ease!

Overview

It is possible to add or remove a director from the company at any time. There are different reasons why a director is removed and there are three different procedures based on the reason. Irrespective of that, True Auditor can help you with removing a director from your company and make the whole process easy for you.

Removal Of Director: Reasons

A director can be removed for any of the following reasons:

  • If they incur any of the disqualifications specified under the Companies Act
  • If they absent themselves from board meetings over 12 months
  • If they enter into contracts or arrangements against the provisions of Section 184 of the Companies Act
  • If they are disqualified by an order of a court or tribunal
  • If they are convicted by a court of any offence and sentenced to imprisonment for not less than six months
  • If they have not abided by the terms and protocols mentioned in the Companies Act of 2013
  • If they have resigned voluntarily from their position.
Ways To Remove A Director
Director removal

There are 3 ways to removal of director from a company:

  • When the Directors Tender Their Resignation
  • Director Remains Absent from the Board Meetings for 12 Months
  • Removal of Director by Shareholders
Consequences Of Not Filing Form DIR-12:

DIR-12 has to be filed within 30 days from the date of resignation. If the company fails to do so, the following penalties will apply:

  • After 30 days – within 60 days: twice the government fees
  • After 60 days – within 90 days: 4 times the government fees
  • If it exceeds 90 days: 10 times the government fees
  • If it exceeds 180 days: 12 times the government fees and will be booked for the compounding offence as well
Documents Required For A Director Removal

The following documents are needed for removal of director

  • Notice of Board Meeting: The first step in the removal of a director is to hold a board meeting and pass a resolution for the removal of the director. A notice of the board meeting must be sent to all the directors of the company, and the resolution must be passed with a majority vote
  • Special Notice to Director: A special notice must be sent to the director who is being removed. This notice should contain the reasons for the removal of the director, along with a copy of the board resolution
  • Resignation Letter: If the director being removed wishes to resign voluntarily, a resignation letter should be obtained and filed with the MCA
  • Form DIR-12: Form DIR-12 is the form used to file the details of the removal of the director with the MCA. This form must be filed within 30 days of the removal of the director
  • Board Resolution: Certified resolution passed in favour of the director removal should be prepared and file directly with the MCA
  • Declaration by Director: A declaration must be obtained from the director being removed stating that they have no objection to the removal.
Eligibility Criteria To Be A Director

To be eligible to be a director in a company in India, an individual must meet the following eligibility criteria:

  • The individual must be at least 18 years of age
  • The individual must have a valid DIN issued by the MCA. If the individual does not have a DIN, they can apply for it online
  • The individual must not be disqualified under the Companies Act, 2013. This means that the individual must not have been declared bankrupt, convicted of an offense, or disqualified by a court or tribunal
  • The individual must give their consent by filing Form DIR-2 with the MCA
  • The individual must be appointed with an appointment letter and must be filed with the MCA in Form DIR-12
  • Resignation: A director can also resign voluntarily by filing a resignation letter with the company and the MCA.
Why True Auditor?

Here is why you should choose True Auditor for the removal of director from your company:

  • Simple and speedy process
  • Experts will guide you through the whole process
  • A resolution drafted and forms filled & filed for you
  • You get the best support
  • All your queries will be answered.

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