Removal of directors
This query is : Open
23 February 2017
In our company total directors are 10.but out of ten director 7 director of company want remove to remove remaining 3 directors , because these 3 directors are doing mismanagement in affairs of company.firstly we appointed 5 first Directors of the company.among five directors one directors are among three directors,so what are the procedure of removal of Directors please guide us
23 February 2017
Section 169 of the Companies Act 2013 deal with removal of a director and states that a company can remove a director before the tenure of his office by passing an ordinary resolution after providing him a reasonable opportunity of being heard.
Further, a special notice is required for removal of a director and such director is entitled to attend the general meeting and is eligible to be heard on the resolution at the meeting. The affected director is entitled to make a representation in writing and can ask the company to circulate the same to all the members of the company and the company is bound to circulate the same if there is adequate time. If time is too short, his representation has to be read out at the meeting.
Note the following precautions before removal of a director
Notice of the board meeting is despatched through the registered post with acknowledgement due as the postal department now has ceased the certificate of posting facilities and also through the registered email-address of the directors with read request of the mail sent with clear 7 days notice under Companies Act 2013. This will ensure that the director has received the notice and also has gone through the contents of the notice of the board meeting. The notice should specify that if the director wants to participate through audio or video-conferencing, then he has to
intimate the same to the company at least 3 days before the board meeting. A director who attends the meeting
through audio or video-conferencing will be counted for the quorum of the meeting
Where a director is removed, the certified copies of minutes can be attached to Form DIR-12 under the Companies Act, 2013. However, in order to avoid future disputes in such matters, it is better to have the evidence of dispatch of notice for the meetings to the said Director, confirming due procedure followed as per the Act and as per the AOA
Optionally, one can also attach Board resolution in this regard and attendance sheet of these meetings and/or
minutes sheet copies of these meetings
Further, a special notice is required for removal of a director and such director is entitled to attend the general meeting and is eligible to be heard on the resolution at the meeting. The affected director is entitled to make a representation in writing and can ask the company to circulate the same to all the members of the company and the company is bound to circulate the same if there is adequate time. If time is too short, his representation has to be read out at the meeting.
Note the following precautions before removal of a director
Notice of the board meeting is despatched through the registered post with acknowledgement due as the postal department now has ceased the certificate of posting facilities and also through the registered email-address of the directors with read request of the mail sent with clear 7 days notice under Companies Act 2013. This will ensure that the director has received the notice and also has gone through the contents of the notice of the board meeting. The notice should specify that if the director wants to participate through audio or video-conferencing, then he has to
intimate the same to the company at least 3 days before the board meeting. A director who attends the meeting
through audio or video-conferencing will be counted for the quorum of the meeting
Where a director is removed, the certified copies of minutes can be attached to Form DIR-12 under the Companies Act, 2013. However, in order to avoid future disputes in such matters, it is better to have the evidence of dispatch of notice for the meetings to the said Director, confirming due procedure followed as per the Act and as per the AOA
Optionally, one can also attach Board resolution in this regard and attendance sheet of these meetings and/or
minutes sheet copies of these meetings
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