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Director in more than 20 companies

Nidhi Sharma (working) (21 Points)

16 May 2017

what steps to be taken when section 165 of CA 2013 is violated i.e the director is director in more than 20 companies.

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4 Replies

Sudhir Todkar (CS Professional) (1021 Points)
Replied 16 May 2017

He should choose any 20 companies (10 Public & Private) in which he/she is interested to continue as a director & resign from other companies by notifying.

He should inform to ROC and all companies regarding reduction in total number of directorship i.e 20.

In order to comply with this provision ROC has given 1year of transition period i.e on or before 31-3-2015..All Directors should not hold more than 20 directorship.

He is also liable for compounding offence.
Not less than 5K but which may extend to 25k per day till such default continues.

Note: Section 8 company are not taken into account.

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Nidhi Sharma (working) (21 Points)
Replied 16 May 2017

Thanks!!

He recently been apointed as an director in one company which sum up for 21 company as aggregate, Do we have any time frame within how many days he has to give his resignation in any of the choosen company by him???

Sudhir Todkar (CS Professional) (1021 Points)
Replied 16 May 2017

ROC has given 1 year of time from 1 April 2014 to 31-3-2015

No excess time to take corrective action in the given case. Such Director has to resign IMMEDIATELY from any 1 Company in which he is not interested or having less interest compare other companies.

Otherwise he has liable to pay 25K per day till such default continues in addition to 5K.