Directors are generally appointed as per the applicable provisions of the Companies Act 2013, by the shareholders of the company to ensure that the day to day operations of the company are executed in an efficient manner. They have a fiduciary duty to the company and its shareholders, which means to say that they are responsible for conducting the affairs of the company in a way that ensures success and profitability and thus enhances the image of the company and its reputation.

The change in the directorship of a company is possible at any time as and when needed. The change can be either voluntarily or through demand. The demand arises in case there is a requirement of an expert in the board or due to the resignation or death of an existing director.

Change in Directors and Related Procedure

The provisions of the Companies Act, 2013 read along with the Companies (Appointment and Qualification of Directors) Rules, 2014 sets down the procedure for the change in Directors.

Addition of a Director

• Board Meeting:
  – Notice to be sent to the directors regarding the agenda of the meeting at least 7 days prior to their respective registered addresses.
  – Pass a Board Resolution to call for a General Meeting where the appointment of the director can be made.
  – Notice to be given to the shareholders regarding the particulars of the meeting, including the agenda, date, time and place of the meeting.

• Annual General Meeting/Extraordinary General Meeting:
  Once the Board Meeting has taken place, the person so appointed to circulate the notice regarding the General Meeting (“GM”), may issue the notice to all of the following:
  – Directors
  – Shareholders
  – Auditors
  The notice of the GM has to be given not less than 21 days prior to the date on which the GM is to be held. However, a shorter notice period can be given if and only if the consent is given by not less than 95% of the members who are entitled to vote at the meeting. The consent has to be obtained either through:
  a) Writing or b) Electronic mode
  At the GM, the resolution will be passed subject to the approval of the shareholders.
• Form DIR – 12 has to be submitted to the Registrar within 30 days from the appointment being made.
• Prerequisites to be a Director:
  – DIN – DSC

Resignation of a Director (Section 168 of the Companies Act 2013)

• The resignation of a director may be considered by him giving the company a notice in writing regarding the reasons for such resignation.

• The Board of Directors, on receipt of the notice given by the director, must present the same in the General Meeting to the shareholders so that they are informed of the same.

• In the General Meeting, the fact regarding the resignation of the director must also be placed in the report of the directors laid before the shareholders.

• The Company must also file Form DIR – 12 with the Registrar within 30 days of the date of resignation.

• The effective date of resignation here will be the latest of:
  – The date on which the notice is received by the company.
  – The date specified in the notice.

Removal of a Director (Section 169 of the Companies Act 2013)

Removal only happens before the expiry of the director’s term. This can be made possible by passing an ordinary resolution at the General Meeting of the shareholders, but only after giving the director a reasonable opportunity of being heard.

a) Notice of the resolution

b) Written Representation

C) Filing with the ROC

Form DIR – 12

This form has to be filed with the particulars of the appointment of directors and key managerial personnel and the changes among them. The details mentioned below have to be entered in:
– Details of the company.
– Details regarding the number of directors, managers etc.
– The date of cessation or the date of appointment, as the case may be.
– Respective DINs and DSCs to be affixed wherever necessary.

2. In case of removal/resignation-

a. Notice of resignation.

b. Evidence of cessation.

3. Any other optional attachments.