Woman Director
The
following class of companies shall appoint at least one woman director-
(i) Every
listed company;
(ii) Every
other public company having -
(a) Paid–up share capital of Rs. 100 crore or more; or
(b) Turnover
of Rs. 300 crore or more.
For
the purposes of this rule the paid up share capital or turnover as on the last
date of latest audited financial statements shall be taken into account.
Independent Director
The
following class of companies shall have at least 2 directors as
independent directors -
(i) Public companies having paid up share capital of Rs. 10 crore or more; or
(ii) Public companies having turnover of Rs. 100 crore or
more; or
(iii) Public Companies having outstanding
loans, debentures and deposits(in aggregate) exceeding rs. 50 crores.
Higher
number of independent directors shall be applicable to a company in case such company
is required to appoint such higher number of independent directors due to composition
of its audit committee.
Qualification: An
independent director shall possess appropriate skills, experience and knowledge
in one or more fields of finance, law, management, sales, marketing,
administration, research, corporate governance, technical operations or other
disciplines related to the company’s business.
Databank of Persons offering to become Independent Directors:
Any
body, institute or association (hereinafter to be referred as “the agency”) authorised
by the Central Government shall create and maintain a data bank of persons
willing and eligible to be appointed as independent director and such data bank
shall be placed on the website of the MCA or on any other website as may be
approved by the Central Government.
Any
person who desires to get his name included in the data bank of independent
directors shall make an application to “the agency” in Form DIR-1.
Any
person who has applied for inclusion of his name in the data bank of independent
directors or whose name appears in the data bank, shall intimate to the agency
about any changes in his particulars within fifteen days of such change.
Note: Any irregular vacancy of an independent director or Woman Director shall be filled-up by the Board at the earliest but not later than
(a)immediate next Board meeting or
(b)three months from the date of such vacancy;
whichever is later.
Small Shareholders' Director
(1) A listed company, may upon notice of not less than 1000 small
shareholders or 1/10 of the total number of such shareholders, whichever
is lower, have a small shareholders’ director elected by the small shareholders.
(2)
The small
shareholders shall leave a notice of their intention to propose a person as a
candidate for the post of small shareholders’ director with the company at
least 14 days before the meeting under their signatures.
(3) The notice shall be
accompanied by a statement signed by the person proposed for the post of small
shareholders’ director stating his DIN, qualification and consent to act as a
director of the company.
(4) Such director shall be considered as an
independent director subject to , his eligibility u/s 149(6) and
his giving a declaration of his independence in accordance with section 149(7)
of the Act.
(5) The appointment of small shareholders’ director
shall be subject to the provisions of
section 152 except that-
§ such director shall not be liable
to retire by rotation;
§ such director’s tenure as small
shareholders’ director shall not exceed a period of three consecutive years;
and
§ on the expiry of the tenure, such
director shall not be eligible for re-appointment.
(6) A person shall not be
appointed as small shareholders’ director if he is not eligible for appointment
in terms of section 164.
(7) A person
appointed as small shareholders’ director shall vacate the office if -
§ the director incurs any of the
disqualifications specified in section 164;
§ the office of the director
becomes vacant in pursuance of section 167;
§ the director ceases to meet the
criteria of independence as provided u/s 149(6).
(8) No person shall hold the
position of small shareholders’ director in more than two companies at the same
time in case the second company is in a business which is competing or is in conflict with the business
of the first company.
(9) A small shareholders’
director shall not, for a period of 3 years from the date on which he
ceases to hold office as a small shareholders’ director in a company, be
appointed in or be associated with such company in any other capacity, either
directly or indirectly.
Consent to act as Director
Every person who has been appointed as a director shall on or
before the appointment furnish to the company a consent in writing to act in Form
DIR-2.
Provided that the
company shall file such consent with the Registrar in Form DIR-12 within
30 days of the appointment of a director along with the required fee.
Application for Allotment of DIN
(1) Every individual, who is to
be appointed as director of a company shall make an application to the Central
Government electronically in Form DIR-3, for the allotment of a DIN
along with required fees.
(2) (a) The applicant shall download Form DIR-3
from the portal on the MCA website, fill in and sign the form using Digital
Signature Certificate and after attaching copies of the following documents,
scan and file the entire set of documents electronically-
§
photograph;
§
proof of
identity;
§
proof of residence;
§
verification by the applicant for applying for
allotment of DIN in Form DIR-4; and
§
specimen signature duly verified.
(b) Form DIR-3 shall be verified digitally by -
§ a chartered accountant or a
company secretary or a cost accountant(all in practice); or
§ a company secretary in full time
employment of the company or by the managing director or director of the
company in which the applicant is to be appointed as director.
Allotment of DIN
(1) The provisional DIN generated
by the system automatically after submission of the Form DIR-3 shall not
be utilized till the DIN is confirmed by the Central Government.
(2)
After
generation of the provisional DIN, the Central Government shall process the
applications received for allotment of DIN and decide on the approval or
rejection thereof and communicate the same to the applicant along with the DIN
allotted in case of approval within a period of one month from the receipt of
such application.
(3)
If the Central Government finds such
application to be defective or incomplete in any respect it shall give
intimation of the same to the applicant directing him to rectify the same by
resubmitting the application within a period of fifteen days of giving such
intimation.
Provided that
the Central Government shall -
§
reject the
application and direct the applicant to file fresh application with complete
and correct information;
§
treat and
label such application as invalid in the electronic record in case the defects
are not removed within the given time
(4)
In case of
rejection or invalidation of application, the provisional DIN so allotted by
the system shall get lapsed automatically and the fee so paid with the
application shall neither be refunded nor adjusted with any other application.
Cancellation of DIN
The Central Government or
Regional Director (Northern Region), Noida or any officer authorised by the
Regional Director may cancel or
deactivate the DIN in case –
(a) the DIN is found to be duplicated in respect of the same person
provided the data related to both the
DIN shall be merged with the validly retained number;
(b) the DIN was obtained in a
wrongful manner or by fraudulent means; *Provided
that an opportunity of being heard shall be given to the concerned individual before cancellation or
deactivation of DIN.
(c) of the death of the concerned individual;
(d) the concerned individual has been declared of unsound mind by a competent Court;
(e) the
concerned individual has been adjudicated an insolvent:
(f) an application made in Form DIR-5 by the DIN holder to
surrender his DIN along with declaration that he has never been appointed as
director in any company and the said DIN has never been used for filing of any
document with any authority
* Provided
that before deactivation of any DIN in such case, the Central Government shall
verify e-records.
Explanation:- For the
purposes of point(b) above -
(i) the term “wrongful manner” means if the DIN is obtained on the
basis of documents which are legally invalid or incomplete or on suppression of material information or
on the basis of wrong certification or by making misleading or false
information or by misrepresentation;
(ii) the term “fraudulent means” means if the DIN is obtained with
intent to deceive any other person or any authority including the Central
Government.
Changes in Particulars of DIN
(1) In case of any change in particulars
of an individual who has been allotted a DIN shall intimate to the Central
Government in Form DIR-6 about any such change within a period of thirty days of such
change(s) in the following manner, namely;-
(i) the applicant shall download
Form DIR-6 from the portal and fill in the relevant changes, attach copy
of the proof of the changed particulars and verification in the Form DIR-7 all
of which shall be scanned and submitted electronically;
(ii) the form shall be digitally
signed by a chartered accountant or a company secretary or a cost accountant (all
in practice);
(iii) the applicant shall submit the Form DIR-6;
(2) The Central Government after
verification of such changed particulars from the enclosed proofs shall
incorporate the said changes and inform the applicant confirming the effect of
such change in the electronic database maintained by the Ministry.
(3)The DIN cell of the Ministry
shall also intimate the change(s) in the particulars of the director submitted
to it in Form DIR-6 to the concerned Registrar(s) under whose
jurisdiction the registered office of the company(s) in which such individual
is a director is situated.
(4)The concerned individual shall
also intimate the change(s) in his particulars to the company(s) in which he is a director
within fifteen days of such change.
Notice of Candidature of a Person for Directorship
The company
shall inform its members at least seven days before the general meeting about
the candidature of a person for directorship or the intention of a member to
propose such person as a candidate for that office-
(1) by serving individual notices
through electronic mode to such members who have provided their email addresses
and in writing to all other members; and
(2) by placing notice of such candidature or intention on the
website of the company, if any:
Provided
that it shall not
be necessary for the company to serve individual notices in case the company
advertises and circulates such candidature or intention, not less than seven
days before the meeting at least once in a vernacular newspaper in the
principal vernacular language of the district where registered office of the
company is situated and at least once in English language in an English
newspaper in such district.
Disqualification of Directors u/s 164(2)
(1) Every director shall inform to the company
in Form DIR-8 about his disqualification u/s 164(2) (if any) before he
is appointed or re-appointed.
(2) Whenever a company fails to
file the financial statements or fails to repay any deposit, interest,
dividend, or fails to redeem its debentures, as specified u/s 164(2), the
company shall immediately file Form DIR-9 to the Registrar furnishing
therein the names and addresses of all the directors of the company during the
relevant financial years and the Registrar shall immediately register the
document and place it in the document file for public inspection.
(3) When a company fails to file
the Form DIR-9 within a period of thirty days of the failure that would
attract the disqualification u/s 164(2), officers of the company specified in
clause (60) of section 2 of the Act shall be the officers in default.
(4) Any application for removal of
disqualification of directors shall be made in Form DIR-10.
Notice of Resignation of Director
The company
shall intimate the Registrar in Form DIR-12 within thirty days from the
date of receipt of notice of resignation from a director and post the
information on its website, if any.
Where
a director resigns from his office, he shall within a period of thirty days
from the date of resignation, forward to the Registrar a copy of his
resignation along with reasons for the resignation in Form DIR-11 along with
required fee.
Register of Directors and Key Managerial Personnel
(1) Every company shall keep at
its registered office a register of its directors and key managerial personnel
containing the following particulars, namely:-
(a) DIN (optional for key
managerial personnel);
(b) present name and surname in
full;
(c) any former name or surname in
full;
(d) father’s name, mother’s name
and spouse’s name (if married) and surnames in full;
(e) date of birth;
(f) residential address (present
as well as permanent);
(g) nationality (including the
nationality of origin, if different);
(h) occupation;
(i) date of the board resolution
in which the appointment was made;
(j) date of appointment and
reappointment in the company;
(k) date of cessation of office
and reasons therefor;
(l) office of director or key
managerial personnel held or relinquished in any other body corporate;
(m) membership number of the
Institute of Company Secretaries of India in case of Company Secretary, if
applicable; and
(n) Permanent Account Number
(mandatory for key managerial personnel if not having DIN);
(2) In addition to the above
details the company shall also include in the aforesaid Register the details of
securities held by them in the company, its holding company, subsidiaries,
subsidiaries of the company’s holding company and associate companies relating
to-
(a) the number, description and
nominal value of securities;
(b) the date of acquisition and
the price or other consideration paid;
(c) date of disposal and price
and other consideration received;
-Contributed by Ms. Azfar Khan (Article Assistant)
