In order to remove a Director of a Company, it is important to ensure that the Company would have minimum required number of Directors after the removal of the said Director. If so, by ordinary resolution the Director can be removed before the expiry of his office term, provided he does not hold office for life term.
The power to remove the director is in the hands of the shareholders as per Section 169 of Companies Act, 2013.
A company may, by ordinary resolution, remove a director, not being a director appointed by the Tribunal, before the expiry of the period of his office after giving him a reasonable opportunity of being heard.
A special notice shall be required to remove a director under section 169 of Companies Act, 2013, or to appoint somebody in place of a director so removed.
Grounds for Removal of Director:
- If he incurs any disqualification under the Companies Act, 2013;
- If he absents himself from board meetings over a period of 12months;
- If he is disqualified by an order of a Court or a Tribunal;
- If he is convicted by a Court of law for any offence which is punishable;
- A bankruptcy order is made against any of the director.
Procedure for Removal of a Director:
A company may remove a director by passing an ordinary resolution.
Special notice shall be required of any resolution to remove a director or to appoint somebody in place of a director so removed at the meeting.
The company shall send a copy thereof to the director concerned and the director shall be entitled to be heard on the resolution at the meeting.
The director, who is sought to be removed, can make a representation in writing against his removal.
How can Law Tarazoo help?
Our team of experts will advise you on the procedure for removing a Director from your company.