Director Removal
Recommendedexclusive of MCA Fees
Starting from₹1499
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exclusive of MCA Fees
Government fees and third-party charges apply where mentioned.
Directors oversee a company's management and operations, while shareholders own the company. Shareholders may decide to remove a director because of inadequate performance or other concerns, and a director may also resign voluntarily.
Director removal is a significant corporate action that must be handled fairly, transparently, and in the company's best interest under the Companies Act, 2013. It may arise through a resolution, resignation, automatic vacation, or judicial order.
LegallensIndia assists companies and directors throughout the removal or resignation process while ensuring compliance with the applicable legal requirements.
A Private Limited Company must have at least two directors to commence operations. Shareholders may remove a director at a General Meeting, except where the director was appointed by the Government.
Removal may result from statutory disqualification, prolonged absence, prohibited transactions, a court or Tribunal order, criminal conviction, non-compliance, inadequate performance, or voluntary resignation.
A director may resign voluntarily by submitting a written notice to the company.
A director who does not attend any Board Meeting for 12 months is considered to have vacated the office under Section 167.
Shareholders may vote to remove a director through a resolution at a General Meeting after completing the required notice and hearing procedure.
| Provision | Subject |
|---|---|
| Section 169 | Legal procedure and rules for removing a director |
| Section 115 | Special-notice requirements relevant to director removal |
| Section 163 | Proportional representation in director selection |
| Rule 23 | Companies (Management and Administration) Rules, 2014 guidance |
A resignation takes effect when the company receives the notice or on a later date specified in the notice, whichever is later. A resigned director remains liable for offences committed during their tenure.
The director submits a written resignation. The Board must formally acknowledge it, notify the Registrar, and include the resignation in the Directors' Report presented at the next General Meeting under Section 168.
Arrange a Board Meeting under Section 173 and Secretarial Standard-1. Send notice to all directors at their registered addresses at least seven days before the meeting, unless urgent circumstances justify shorter notice.
Send the agenda, explanatory notes, and draft resolution with the meeting notice. At the meeting, the Board acknowledges the director's resignation.
Authorise the Company Secretary, CFO, or another director to submit the required forms and documents to the Registrar of Companies.
A listed company must promptly disclose the resignation to the stock exchange according to Regulations 30 and 46(3) of the SEBI Listing Regulations, 2015.
Within 15 days of the Board Meeting, send draft minutes to all directors by hand, speed post, registered post, courier, or email for review.
Under Section 167, a director who fails to attend every Board Meeting for 12 months vacates the office even when no leave of absence was requested.
Schedule a Board Meeting with at least seven days' notice to all directors and include the proposed director removal in the agenda.
At the Board Meeting, pass a resolution to convene an EGM and propose a director-removal resolution subject to shareholder approval.
Send the EGM notice to all shareholders with a clear 21-day notice period, excluding the date of dispatch and the meeting date.
Allow the director to present their explanation before voting. The shareholders then vote on the Ordinary Resolution, unless the Articles or applicable law require otherwise, and the resolution passes if supported by a majority.
After the resolution passes, the outgoing director may file DIR-11 where applicable, and the company must file DIR-12 with the Registrar and attach the relevant resolutions and documents.
After successful filing and completion of the formalities, the removed director's details are taken off the MCA database.
| Delay | Additional Fee Stated in the Content |
|---|---|
| 30 to 60 days | Two times the standard government fee |
| 60 to 90 days | Four times the standard government fee |
| More than 90 days | Ten times the standard government fee |
| More than 180 days | Twelve times the standard government fee, with possible compounding action |
After a director resigns or is removed, the company may need to amend registrations and records maintained under the following laws and regulatory systems:
LegallensIndia helps companies complete director removal smoothly and professionally while respecting the interests of everyone involved.
Within 30 days after receiving the resignation, the company files Form DIR-12 with a certified copy of the Board Resolution, the resignation notice, and proof of cessation.
The resigning director may file Form DIR-11 within 30 days of resignation with the resignation notice, evidence of dispatch, and the company's acknowledgement of receipt.
Update the Register of Directors and Key Managerial Personnel to record the resignation and related changes.