Director Removal

Director removal is the process by which a company ends a director's tenure before the natural expiry of their term. It is governed principally by Section 169 of the Companies Act, 2013, which lets shareholders remove a director by ordinary resolution passed at a general meeting, after giving the director a reasonable opportunity of being heard. Two categories are excluded from this route: directors appointed by the National Company Law Tribunal under Section 242, and directors appointed through proportional representation under Section 163.

How it works

• A member gives the company special notice (under Section 115, at least 14 clear days before the meeting) of the intention to move the removal resolution.
• The company forwards a copy to the director concerned, who may make written representations and ask that they be circulated to members, and is entitled to speak at the meeting.
• Members pass an ordinary resolution (simple majority). Another director may be appointed in the vacancy at the same meeting if special notice of that appointment was also given.
• The company files Form DIR-12 with the Registrar of Companies (ROC) within 30 days.

Special cases

An independent director who has been re-appointed for a second consecutive term under Section 149 can be removed only by special resolution (75% majority), again after a reasonable opportunity of being heard.

Not the same as

Removal under Section 169 is distinct from automatic vacation of office under Section 167, disqualification under Section 164, voluntary resignation under Section 168, and Tribunal-ordered removal in oppression and mismanagement cases under Section 242. Each follows its own procedure, though all changes in directorship are reported to the MCA via DIR-12.