Please Help: Resignation of Director
Posted Date : 17-Jan-2012 , 05:35:43 pm | Posted By: CA Vinod Kumar
Category :
Corporate Law | Answers :
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Dear Expert,
My Client is a private limited Company and having 3 director's,,The Company wants to remove 1 director but the director is not giving consent for the same,,,,what is the modes operandi in this case,,,,,pls help |
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Answers:
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 Answer by: PRIYANKA |
| In this Case when the director is not giving consent for resignation, it needs to be proved that he was for more than six consecutive months have been absent without permission of the directors from meetings of the directors held during that period and the directors resolve that his office be vacated.In short, It needs to be proved that the director is not taking active participation in managing the affairs of the company . And then the company can remove him by taking following steps:
Removal by Ordinary resolution
Subject to the points made below, any director can be removed by an ordinary resolution of the general meeting under the following provisions of the Companies Act 2006.
sec168 (1) A company may by ordinary resolution at a meeting remove a director before the expiration of his period of office, notwithstanding anything in any agreement between it and him.
(2) Special notice is required of a resolution to remove a director under this section or to appoint somebody instead of a director so removed at the meeting at which he is removed.
(5) This section is not to be taken (a) as depriving a person removed under it of compensation or damages payable to him in respect of the termination of his appointment as director or of any appointment terminating with that as director, or (b) as derogating from any power to remove a director that may exist apart from this section.
The special notice provisions are set out in sec312 , This provides that the resolution is not effective unless notice of the intention to move it has been given to the company a least 28 days before the meeting at which it is moved. The company must then give notice of the resolution at the same time and in the same manner as it gives notice of the meeting (or, if that is not practicable, must advertise in an appropriate newspaper).
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| Answer by: Lavina Bajaj |
| the power of removal of directors vested in the shareholders of a company is a weapon by which the shareholders exercise control over the Directors. The power of removal of directors thus helps preserve democracy and ensures that the Board functions in the interests of the shareholders and the company and does not abuse its powers.
In future, a director of the company, whether under an agreement or not and notwithstanding anything to the contrary in its articles would be removable by an ordinary resolution of which special notice has been given. The right proposed to be given to a director, who is likely to be affected by any such resolution, to make a representation to the company at the company’s expense will ensure the consideration of the pros and cons of any such resolution by the general body of shareholders, before a decision is taken by them to remove him. In our opinion, the general body of shareholders should have greater powers to remove a director with whom they are dissatisfied whether such director is under a contract of service or not.
The provisions of Section 284 are in addition to any other power that may exist for removal of a director.
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| Answer by: Mrattunjay |
| Refer Director contact and pass resolution for removal...
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