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Appointment/Adding a Director to Your Company
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Adding a Director - Overview
It is possible to add or remove a director from the company at any time. While the articles of incorporation should have provisions allowing it, the Articles of Association and Companies Act provisions dictate how and who can be appointed as a new director. Additional director appointment to the company involves following a bunch of procedures and Vakilsearch is here to help you make the whole process easy for you. In addition, you can receive the director appointment form at ease.
Under the section 2 (34) of the Companies Act, 2013 -a person who has been appointed to the Board of Directors is called a “Director” who is appointed to carry out the responsibilities and functions that a company’s director do in accordance with the Companies Act of 2013.
Why to Change Directors of a Company?
The following are the common reasons why people choose to add or change directors in the company :
To get new talent on board
As your company grows and evolves, you will need to bring new talent on board to meet the new requirements and challenges. It is natural to want to add or make changes in the top-level management.
No dilution of ownership
Directors are primarily responsible for the day-to-day operations of a company. Adding or appointing an additional director helps the shareholders assign more operational responsibilities without losing any strategic control.
Inefficiency of existing directors
It could be that the existing directors cannot meet the requirements of the work or maybe even due to retirement, family problems, physical ailments or other personal reasons. In such cases, you need to add new directors.
To meet the statutory limit
Every type of company needs a certain number of directors. In case of sudden death or plans of retirement from existing directors, you will have to add another director to your company.
Documents Required for Appointment of Director
- Passport
- Identification proof (PAN card)
- Proof of residence (electricity bill, rental agreement, Aadhar Card, voter ID, passport, driving license)
- Passport size photograph
- Digital signature certificate of the proposed director
- PAN card: mandatory for an Indian applicant
- Passport: mandatory for a foreign applicant.
Procedure of Adding a Director of the Company
The process of adding a director is more complicated than one might think it to be.
Step 1: Check if the articles (AOA) of the company supports adding an additional director. If there are no such provisions in the AoA of the company, then modify the AoA of the company in a way that allows adding an additional company director.
Step 2: The proposed director must give his or her consent to act as the director via director appointment form
Step 3: Step 3: The company must pass a board resolution for appointment of directors in company law
Step 4: Get DSC (Digital Signature Registration) and DIN (director identification number) for the new director.
Step 5: Collect the basic documents and information required for the process and get Form DIR-2, Form DIR-12 and Form DIR-8 at ROC done.
This is a simplified version of the process. Vakilsearch will take care of mostly everything in these steps for you. After this basic process is over, there are a few more formalities that need to be completed after this process and our team will explain those to you.
Why Dreamunicus
Here is why you should choose Dreamunicus for adding a director to your company:
- Simple and speedy process
- Experts will guide you through the whole process
- A board resolution for appointment of director drafted and forms filled & filed for you
- You get the best support
- All your queries will be answered.
Frequently Asked Questions (Faq)
Yes, there is and it is as follows:
- The proposed individual must be a major.
- They must qualify as per the laws mentioned under the Companies Act, 2013.
- The members of the board must consent to the appointment of the proposed individual.
No, a DIN or director identification number is permanently allotted and can be used for a lifetime. Once it is allotted, the same number may be used for multiple appointments and resignations.
No, as per the Companies Act, 2013, only individuals can serve as directors of public and private limited companies.
Yes, an NRI or foreign national may be added as a director in a private limited company as long as there is at least one director on the board who is an Indian resident. To do so, they must have a valid passport and a DIN.
The minimum number of directors required is based on the type of company. For a one-person company it is 1, for a private company it is 2 and a public company needs to have at least 3 directors.
A person cannot be appointed as a director if he doesn’t qualify under the AoA, if they are an undischarged bankrupt, or if they are restricted by a court order.
A private company can have a maximum of 15 directors.
Yes, the process is 100% online. We will provide you with a dashboard in which you can comfortably do everything.
Yes, a person with a criminal record can be a director of a company as long as they are not restricted specifically by a court order.
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