Now learn more about the format of the board resolution for the removal of a director and other liabilities involved in the process.
Removal of a director by the shareholders of the company contributed if they adhere to the requirements of the Companies Act, 2013. As we all realize that directors are always responsible to the shareholders of the firm. Being the holders of the firm, it is not reasonable for the shareholders to deal with the business functions and thus illustrates the position of the directors of the firm. Lets have a look at format of board resolution for removal of director.
The layout of the board finding for removal of director is specified in the requirements Companies Fifth Amendment rules, 2019. Shareholders can eliminate the director any time before the expiry of his term except for any director who is elected by the tribunal or any court of law.
Format of Board Resolution for Removal of Director
‘It is resolved that Mr./Ms. (DIN…) under requirements of Section 169 and other acceptable conditions of the Companies Act, 2013 and the rules framed thereunder is no longer the director of the firm as of the date of this meeting.’ An explanatory statement under Section 102 of the Companies Act, 2013 explains that your firm has obtained special notice companies act and requisition dated … from (name of the member), who holds (number) of shares in (name of the company) with a proportion of …% of the voting stock, mandating that an EGM be assembled to evaluate and if suitable, to vote on an ordinary resolution to eliminate a director of company named Mr./Ms. The annexure to this document is attached.
Currently, Mr.Ms. holds the position of …director of the corporation. He /She was nominated as an Executive or Non-Executive Director by the Board on ___and at the annual general meeting on____. You will find the details of his conferences in the Appendix.
The Board of directors of (Name of Company) met on (Date) and held an annual personal director evaluation, including Mr./Ms. . The standards consisted of subsidizing the director to the board and conference meetings, which were held on the topics to be covered, as well as meaningful and beneficial payments and intakes in meetings, etc. In addition, the directors’ self-assessments and interchanges were used to establish the standards.
The board of directors of the company, in its … meeting held on (Date), passed a judgment reducing Mr. / Ms. …. Director with effect from the date of this EGM. The Board of Directors made a decision to protect the company’s larger interests.
Ms./Mr…has notified the company that she/he plans to write both, a manifestation verbal to shareholders and a document to be submitted to shareholders in favor of her/his removal. The Companies Act, 2013, provides for the liability of Section 169(4) if the firm publishes a written articulation to investors.
Besides Mr./Ms. .. other directors or managerial key personnel of the firm or their relatives are desirous in the finding as specified in Item No.
Procedure for Director Resignation
Notice of Resignation: The resigning director has to deliver a letter of resignation to the company referring to the explanations for such resignation with the beneficial date.
Call for a Board Meeting: Upon obtaining the letter, call for a board meeting and enact the provided statement of the resignation of the director and approve a director to document the recovery with the Registrar of Companies(ROC).
Filing of Return of Resignation by the Company with the Registrar of Companies: A return of resignation of directorship in form DIR-12 is expected to be documented with the registrar within 30 days of concession with a document of board resolution along with a resignation letter to manage. Once the form DIR-12 is submitted to the ROC, the circumstances of the quit director shall be eliminated in the Ministry of Corporate Affairs (MCA) portal against the respective company.
Filing of Return of Resignation by the director himself with the Registrar of Companies: The resigning director may file his resignation willingly to the ROC in form DIR 12 form along with the explanations for resignation within 30 days from the date of submission
Liability of Director After Resignation
Once the director has relinquished and the board has accepted his resignation, the director is not responsible for any penalties that are incurred by the company after the date of approval of the concession. However, a director is still accountable for any violations that have happened during their directorship.
How Vakilsearch Can Help in the Removal of Directors.
Removing the director from a firm is a liability to both the director and the business organisation. Experts at Vakilsearch help more than 1000 companies in a month regarding their legalities. When it comes to removing a director, experts at Vakilsearch can handle it with a holistic approach. We will help you file form Dir- 11 and form Dir- 12 on your behalf. This will help you avoid penalties due to any non-compliance. Leave the highly legal process to experts.
Read More
