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Resignation of Director of Private Limited Company

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Resignation of Director of Private Limited Company

As per Section 149(1)(a) of Companies Act, 2013 every private limited company needs to appoint at least 2 individuals as directors of the company. If a company wants to appoint more than 15 directors then it needs to pass a special resolution in the Extraordinary General Meeting (EGM). Every director post appointment shall apply for a Director Identification Number (DIN) which shall be allotted by Central Government.

The resignation of a director of a private limited company is governed by Section 168 of Companies Act, 2013 and Rule 15 of Companies (Appointment and Qualification of Directors) Rules, 2014. As per the Section, a director who intends to resign shall send the notice to the Company and the Board in writing. As per sub-section (2) of the Section the resignation shall be in effect from the date the notice is received or the date mentioned by the director in the notice, whichever is later.

The company shall pass a Board resolution confirming the director's resignation. The company shall then electronically file Form No. DIR-12 within 30 days of the resignation being effective. It shall also intimate its members and shareholders of such resignation by stating it in the Director's Report that is to be laid in the following General Meeting. 

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Director's responsibility (during resignation of director of Private Limited Company)

The director, on the other hand, needs to file Form No. DIR-11 electronically in which he shall mention the reason for resignation and submit it along with a copy of notice sent to the company, proof of dispatch and prescribed fees within 30 days of resignation becoming effective under his personal digital signature. The Act expressly enshrines that a resigning director shall remain liable to the offenses which occurred during his tenure as director of the company.

In case all directors of a company resign or vacate their offices then the promoter of the company or Central Government in his absence shall appoint the requisite number of directors who shall hold office till a fresh set of directors are appointed by the company at a General Meeting.

These are the provisions relating to resignation of director under Companies Act, 2013. For more information you can visit www.registrationsindia.com

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