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Removal of director

Rais khatri (article student) (47 Points)

07 October 2017

can anyone please help me validate my understanding of proviso to section 169(1) that director(s) appointed under section 163 can not be removed under section 169 as it says this section is not applicable to such directors.

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5 Replies

RAJESH KUMAR (STUDENT) (67 Points)
Replied 07 October 2017

it is only saying that company can remove any director at its general meetings and make new appointments except the one appointed by NCLT under section 242

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Rais khatri (article student) (47 Points)
Replied 07 October 2017

Mr.Rajesh kumar kindly refer proviso as mentioned.

RAJESH KUMAR (STUDENT) (67 Points)
Replied 07 October 2017

provision regarding removal is not clear , so it can be deemed that a director appointed by PROPORTIONAL REPRESENTATION cannot be removed. but he can be disqualified.

Lovepreet Singh (Army of Final War) (359 Points)
Replied 08 October 2017

A director is appointed under the proportional representation , if he secure quota of votes fixed for him, he represents specific group of shareholders or miniority, if this section will be applicable to them then majority shareholders having contradictory /overriding decisions power may send notice to company to remove such miniority shareholder director, and that would be in prejudice to the interest of such shareholders, probably the intention of law makers would be to restrict removal of such directors to safegaurd the interest of miniority shareholders or specific group of shareholders.