Change in Director of a Company – An Overview

Generally, a Company is a legal entity established by a group of individuals to engage in & operate a business entity (commercial or industrial) A Company may be organized in various ways for tax & financial liability purposes depending on the corporate law of its jurisdiction. A Company’s management structure includes a Director’s position and key managerial positions in any company. Directors take overall charge of management & operations in a Company. Usually, Directors of a Company are appointed as per the Companies Act, 2013 by the Company’s Shareholders to ensure that the company's day-to-day operations are executed effectively. Directors of a Company have a fiduciary duty to the Company & its shareholders, which means that all the Directors of a Company are responsible for conducting the Company’s Affairs in a way that ensures profitability & boosts the Company’s image & reputation. Scroll down to check more about changes in the Director of a Company.

Change in Director – Meaning

The Change in Director of a Company is possible at any time when required. The change of Directors can be either voluntarily or through demand. The demand arises in case there is a requirement of an expert in the Board or due to death/resignation or death of an existing Director.

Change in Directors of a Company is event-based compliance & it should be intimated to the Registrar of Companies within 30 days of passing of the resolution in the Board Meeting. There are some forms that are required to be filed with the RoC declaring Resignation, Appointment, or change in Directors of a Company. If you want help, then contact our team to file forms regarding the Change of Directors or any event-based compliance of a Company.

Eligibility Criteria to become a Director

The following are the criteria to become a Director of a Company:

1: An Individual’s age should be above 21 years & below 70 years;

2: The individual shouldn’t be an undischarged insolvent;

3: There shouldn’t be any order in force passed by a Court or Tribunal disqualifying the person for the appointment of a Director;

4: An individual shouldn’t have been convicted by a court of an offense & sentenced to imprisonment for more than 6 months & a period of 5 years should have elapsed from the expiry of the sentence;

5: An individual shouldn’t have applied to be adjudicated as an insolvent;

6: There shouldn’t be any order in force passed by a Court or Tribunal disqualifying the individual for Director’s appointment;

7: The person must have DIN & DSC;

8: An individual shouldn’t have been convicted of the offense dealing with related party transactions under Section 188 at any time during the preceding 5 years;

9: The person or an individual shouldn’t be appointed as a Director in more than 19 companies or 9 companies in the case of public companies since the maximum number of companies in which a person or an individual can act as a Director is 20 companies or 10 companies in the case of public companies;

10: An individual can’t be appointed as a Director if he or she is a Director in the following companies:

• A Company that has failed to repay the deposits, interest on deposits, failed to redeem any debentures on the due date, pay interest on debentures, or pay the dividend declared for more than 1 year;
• A Company that hasn’t filed financial statements/annual returns for a continuous period of 3 Financial Years.

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