Appointment of Additional Director

INTRODUCTION

  • We are here Discuss the legal validity, Procedure & Timelines for Appointment of Additional Directors.
  • This section 161 applies to public company & private company which is a subsidiary of the public company

LEGAL PROVISIONS

  • As per section 149 (1) of companies act 2013, every company to the required appointment of Directors (only Individuals) in Board of company.
  • The company have a limit of Minimum & Maximum Directors as per the following List:-
Minimum & Maximum Director Appointment Limit

The company Articles of Association (AOA) allows the company to appoint Additional Directors. Additional Directors must have DIN (Director Identification Number).

  • The procedure of appointing of Additional director as per section 161 of companies act, 2013 and relevant rules.
  • The person not able to appoint as a director in General meeting of shareholder or Resolution to appointment is failed in general meeting (Not getting majority Votes) shall not eligible to appoint as Additional Director in the company through Board Resolution.
  • The appointment of Additional director by the Board of Directors (BODs) bypassing Board Resolution by Majority (MORE THAN 50% VOTED IN FAVOR).
  • The Tenure of Additional director is the date of UPCOMING Annual General Meeting (AGM) OR the Last date of AGM should be held (Normally 30th September) WHICH IS EARLIER.
  • THE RESOLUTION IS PRESENT IN AGM FOR CONTINUING HOLD THE OFFICE OF ADDITIONAL DIRECTOR IN COMPANY AND RESOLUTION PASSED BY MAJORITY (MORE THAN 50% VOTED IN FAVOR) OF SHAREHOLDERS.

PROCEDURE FOR APPOINTMENT OF ADDITIONAL DIRECTOR

  • Drafting of Board Meeting Notice by Company Secretary or Legal Advisors.
  • Send 7 Days advance notice of Board Meeting to all directors Through Mail / Courier / Registered Post.
  • The Board meeting to held any place, time & Days (Even public Holidays).
  • The Additional Director is appointed through Physical Board Meeting as well as Board Resolution by Circulation.
  • Calling of Board Meeting.
  • Resolution present in the front of Board of Directors with full details of candidate to be appointed as Additional Director.
  • Appointment of Additional Director made by the Board of Directors by passing Board Resolution.
  • Issue Appointment letter (mention all Terms & Conditions) by Company.
  • Preparation of Minutes / Certified True Copy (CTC) of Board resolution / other relevant Documents.
  • Filing of Form DIR – 12 with Registrar of Companies (ROCs) through MCA portal within 30 days of appointment.

DOCUMENTS REQUIRED FOR APPOINTMENT OF ADDITIONAL DIRECTOR

  • The person must have DIN (Director Identification Number).
  • The person cannot appoint as Directors in more than 20 Companies.
  • The person is not disqualified under section 164 of companies act, 2013 to appoint as Additional Director.
  • DIR – 2 (Consent to Act as Director of Company).
  • DIR – 8 (The person is not disqualified under section 164 (2) of companies act, 2013
  • MBP – 1 (Disclosure of Interest by Director at the time of appointment as well as every financial year.
  • MGP 14 (The Additional Director is one level Below KMP (Key Managerial person)

 

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