Appointment / Resignation of Director

Appointment of Director

Director of a company is a person elected by the shareholders for managing the affairs of the company as per the Memorandum of Association and Articles of Association of the company. Since a company is an artificial judicial person created by law, it can only act through the agency of natural persons. Thus, only living persons can be Directors of a company and the management of a company is entrusted to the Board of Directors. Appointment of Director can be required for a company from time to time based on the requirements of the shareholders of the business.

Conditions for Appointing Directors

The following conditions are applicable when appointing a director:

  • He or she should not have been sentenced to imprisonment for any period, or a fine imposed under a number of statutes.
  • They should not have been detained or convicted for any period under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974.
  • He or she should have completed twenty-five (25) years of age, but be less than the age of seventy (70) years. However, this age limit is not applicable if the appointment is approved by a special resolution passed by the company in general meeting or the approval of the Central Government is obtained.
  •  They should be a managerial person in one or more companies and draws remuneration from one or more companies subject to the ceiling specified in Section III of Part II of Schedule XIII.
  • He or she should be a resident of India. ‘Resident’ includes a person who has been staying in India for a continuous period of not less than twelve (12) months immediately preceding the date of his or her appointment as a managerial person and who has come to stay in India for taking up employment in India or for carrying on business or vocation in India.

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