Director of a Company

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Definition
As

per Sec. 2(13) of The Companies Act, 1956, Director includes any person occupying the position of director, by whatever name called.

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Meaning

The persons who are in charge of the management of the affairs of the company are termed as directors. They are collectively known as Board of Directors or the Board. body corporate or firm can be appointed director of a company. Only individual can be so appointed.

No

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Number of Directors
As

per Section 252, Every public company (other than deemed public company) shall have at least 3 directors and every other company (e.g., a private company, a deemed public company) at least 2 directors.

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Director Identification Number

Newly

inserted proviso to Section 253 makes it obligatory for companies to ensure that directors have been allotted Director Identification Number (DIN) as required under newly inserted Section 266B of the Act.

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Director Identification Number

Companies

(Amendment) Act, 2006 has introduced provisions with respect to Director Identification Number (DIN) w.e.f. 1.11.2006.

the purpose, Section 253 has been amended and seven new sections namely, Sections 266A, 266B, 266C, 266D, 266E, 266F and 9/23/12 266G, have been added.

For

Director Identification Number

The

Central Government has Notified the Companies (Director Identification) Rules, 2006. has appointed 1-11-2006 as the date eon which the provisions of these rules shall come in force. Central Government has issued ad notified Forms DIN-1, DIN-2, DIN3, DIN-4.

It

The

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DIN Forms
DIN DIN

Form 1: Allotment of DIN

Application

for

Form 2: Director is to intimate his DIN to the company or all companies. Form 3: Company is to intimate DIN to Registrar within one week of receipt from the Director. Form 4: Changes in the

DIN

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DIN

APPOINTME NT of DIRECTORS
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1. First Directors
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First Directors
The

Articles of a company usually name the first directors by their respective names or prescribe the method of appointing them.

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First Directors
If

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the first directors are not named in the Articles, the number of directors and the names of the directors shall be determined in writing by the subscribers of the Memorandum or a majority of them (Clause 64 of Table A).

First Directors
If

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the first directors are not appointed in the above manner, the subscribers of the Memorandum who are individuals become directors of the company, and shall hold office until directors are duly appointed in the first

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2. Appointment by the Company

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Appointment by the Company

In

a public company, at least 2/3rds of total number of directors shall be liable to retire by rotation, and are called rotational directors and shall be appointed by the shareholders in general meeting.

only 1/3rd of the total number of directors can be permanent 9/23/12 directors.

Thus

Appointment by the Company

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Appointment of Rotational Directors

At

the annual general meeting at which a director retires by rotation, the company may fill up the vacancy by appointing the retiring director or some other person.

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Appointment of Rotational Directors

If

the place of retiring director is not filled up, the meeting may resolve not to fill the vacancy. If there is no such resolution, the meeting shall stand adjourned till the same day next week.

at the adjourned meeting also, the place is not filled up, the retiring 9/23/12 director shall be deemed to have

If

Appointment of a new Director

Fourteen

days notice and deposit of

` 500. If a new director is to be appointed, a notice in writing shall be given to the company at least 14 days before the meeting

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Appointment of a new Director

The

company shall inform the members at least 7 days before the meeting about the candidature of the person for the office of director by serving individual notice on members or through advertisement in 2 newspapers.

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3. Appoint by Directors
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As Additional Directors (Sec. 260)

Any

additional director appointed by the directors shall hold office upto the date of the next annual general meeting of the company. number of directors and additional directors must not exceed the maximum strength fixed for the Board by the Articles.

The

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In a casual vacancy (Sec. 262)

If

the office of any director appointed by the company in a general meeting is vacated before his term expires in normal course, the resulting casual vacancy may be filled by the Board at the Board Meeting.

person appointed in a casual vacancy shall hold office only upto the date upto which the director in 9/23/12

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4. Appointment by Third Parties

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Appointment by Third Parties

The

articles under certain circumstances give power to the debenture holders or other creditors who have advanced loans to the company to appoint their nominees to he Board.

number of Directors so appointed shall not exceed 1/3rd of the total number of directors, and they are not liable to retire by 9/23/12

The