Board Of Directors

A board of directors is a group of individuals that are

elected as, or elected to act as, representatives of the

stockholders to establish corporate management related
policies
To make decisions on major company issues. Every

public company must have a board of directors. Some

private and nonprofit companies have a
board of directors as well.

Structure
The number of members of a board can vary in size:

some companies have boards with as many as 15

members or as few as 3. The ideal size of a board is 7.
No matter the number, ideally the board of directors
should be a representation of both management and
shareholders' interests by consisting of both inside and
outside members.
An inside director is a member who has the interest of
major shareholders
Independent or outside board directors are not involved
in the inner workings of the company and bring
experience from working in with other businesses.

Firstdirectors
First directors of a firm are appointed by the original

investors usually from among themselves, and are

named in the articles of association.
Appointment or election of the subsequent directors is

usually effected at a general meeting by a resolution to

the effect.
Directors often have the power to fill vacancies on the

board of directors at any time

Appointment of Directors
The shareholders, who are individuals shall be deemed

to be the first directors of the company until the directors

are duly appointed.
Director to be appointed in a general meeting.
The proposed Director has to furnish his DIN (Director

Identification Number) mandatorily.

The proposed Director has to also furnish a declaration

stating that he is not disqualified to be a director.

Vacation, Removal and

Retirement of Director
Manish Tripathi

Vacation of office of director- Section 167-1

He incurs any of the disqualifications specified in section

164.
He does not remain present in all the meeting of Board of
directors held during the period of 12 months or without
seeking leave of absence of the Board.
He acts in contravention of the provisions of section 184
relating to entering into contracts or arrangements in which
he is directly or indirectly interested.
He fails to disclose his interest in any contract or
arrangement in which he is directly or indirectly interested.
He becomes disqualified by an order of a court or the
Tribunal
Convicted by court for any offence.
Appointed as an employee in the holding subsidiary or Any
associate company.

Section 167-2
Continues to function as director even after

knowing he has become disqualified.

In Such Cases he shall be punishable with
imprisonment for a term which may extend to
1 year or with fine which shall not be less than
Rs. 1,00,000 but which may extend to Rs.
5,00,000 or with both.

Under Section 167-3 & Section

167-4
Where all the directors

of a company vacate
their offices under
any of the
disqualifications
specified till now.
In such cases the
promoter or, in his
absence, the Central
Government shall
appoint the Director.

A Private company may be by its article,

provide any other ground for the vacation of
office of the director.

In addition to any those specified sub-edition.

Section 168 Resignation of

Directors.
Resignation notice in writing to company.

The Board shall, on receipt of such notice within 30 days intimate the Registrar in
Form DIR-12

The director shall also forward a copy of resignation along with detailed reasons
for the resignation to the Registrar in Form DIR-11 within 30 days from the date of
resignation

The notice shall become effective from the date on which the notice is received
by the company or the date, if any, specified by the director in the notice,
whichever is later.
The director
who has resigned shall be liable even after his resignation for the
offences which occurred during his tenure.

If all the directors of a company

resign from their office or vacate
their office, the promoter or in his
absence the Central Government
shall appoint the required number
of directors to hold office till the
directors are appointed by the
company in General Meeting.

Removal of the Director

section 169

The Share holders, the

central Government or
The court can remove the
directors. The rules
regarding the removal
are as follows

Removal-By share Holders

A company may by an ordinary resolution can

remove the director before the expiry of the

prion of the office except in the following
cases.

Directors who can not be removed.

An additional director appointed by the

central government under section 408 after

mismanagement and oppressions can not be
removed.
In a private company director appointed for
life and holding office such on 1st April 1952
can not removed by members resolution.
where the articles of a company provide for
election of the director by proportional
representational director elected by that
method can not be removed by the
resolutions.

Special notice for removal of

directors
Special notice must be given of the resolution

to remove a director, copy of which must be

given to the director concerned.
The meeting which removes a director can
elect another in his place if the director was
originally appointed by election.

Removal by the central

Government
Central government shall by order remove

from the office any directors against whom

there is a decision of high court, holding that
he is not fit or proper person to hold the
office of director.

Removal by Court
Under section 402 read with section 397 and

398 gives wide power to the court including

the removal of the directors.

Remunaration to the Director for

removal
If a director, by an agreement or otherwise

enttitle to receive the compensation for the

premature termination of his service can
enforce his claim now]t withstanding the
removal by resolution.

Thank
You..