PLC
Procedure of Changing the Director of a Company
The shareholders of a company appoint certain individuals for managing the company. These people are the Directors of the company.
A Private Limited Company is required to have at least 2 Directors at the time of incorporation. However, the maximum number of Directors in a PLC can only be 15. It is not mandatory for the shareholders to be the Directors in a company, but they can choose to be one if need be. For an individual to be a Director of a company, he/she is required to be 21 years of age or older and can be an Indian or Foreign National. It is also mandatory for a Director to get a DIN (Director Identification Number) issued in his/her name.
Here, we will talk about the procedure of changing the Director of a company. Moreover, we will discuss the process of enforcing this change in the company and the documents as well as the forms that are supposed to be filed to initiate the process.
The appointment and resignation of Directors in a Private Limited Company is governed by the Companies Act, 2013 and the rules stated thereunder.
A Director needs to file for a DIN in E-Form DIR-3 to get a Director Identification Number issued in his/her name. Our experts will do the required filing for DIN on your behalf. You will just have to provide us with the following information –
- Full name of the applicant
- Full name of the applicant’s father
- Photograph (only in JPEG format) & Specimen Signature
- Nationality
- Date of Birth
- Educational Qualification and current occupation of the applicant
- A copy of permanent residence proof
- A copy of Photo ID Proof
- A copy of PAN Card
- Email address & Phone number
- A copy of the passport (in case of foreign director)
In case the documents submitted are in any other language besides Hindi or English, a translation is supposed to be done by the notary of the home country.
Once our team receives the required documents, we will initiate the process of registering you as the Director of a company. A consent, intimation, and disclosure are required from the individuals proposed to be appointed as the Director of the company.
- Pursuant to Rule 8 of the Companies (Amendment and Qualification of Directors) Rules, 2014, a consent needs to be obtained in writing from the applicant in Form DIR-2.
- After the appointment of the Director, an intimation is required pursuant to Rule 14 of the Companies (Appointment and Qualification of Directors) Rules, 2014.
Before appointing a Director, a meeting is conducted by the Board Members in which they pass a resolution for the appointment of the Director and issue a letter of appointment.
Form DIR-12 is filed pursuant to Section 170 (2) of the Act read with Rule 8 of the Companies (Appointment and Qualification of Directors) Rules, 2014 with the Registrar of Companies within 30 days of appointing the Director. The Letter of Appointment, a certified true copy of the Board Resolution and Form DIR-2 is filed along with Form DIR-12.
Now that we have talked about the appointment of a Director in a Private Limited Company, let’s discuss the removal of a Director from a company.
Pursuant to Section 168 (1) of the Act, a Director can resign from directorship simply by giving a notice in writing to the company. Form DIR-11 is filed to inform the Registrar about the resignation of the Director. This form is filed within 30 days from the date of resignation of the Director with the Registrar of Companies at the Ministry of Corporate Affairs. Form DIR-11 must contain the reason for the resignation of the Director and should always be filed with a copy of the notice of resignation given to the company and proof of dispatch.
Once the Director gives a notice of resignation, a board meeting needs to be conducted to pass a resolution for accepting the resignation of the Director. Form DIR-12 is the final form to be filed with the relevant RoC within 30 days from the date of resignation of the Director along with a copy of the Notice of Resignation and copy of board resolution stating the evidence of cessation.
FAQs
As per Section 149 (1)(a), certain categories of companies are required to have at least one female Director. Such companies may include listed companies or public companies with a Paid Up Capital of Rs. 100 cr. or more, or a Turnover of Rs. 300 cr. or more.
Individuals who are deemed insolvent, have suspended payment to creditors, or have been convicted of offences involving moral turpitude cannot be appointed as Directors. In addition, failure to obtain a Director Identification Number disqualifies an individual.
