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Add Director
Addition Of Director In Board Of Directors
Addition of New Directors
- Shareholders elect directors to manage the company based on its governing documents.
- Directors must be living individuals to act on behalf of the company.
- The Board of Directors oversees the company’s operations.
- Nominations for directors may be necessary as per the shareholders’ requirements.
How to add a Director to a Company?
- Obtain Consent: Ensure the proposed directors agree to their appointment, documented in Form DIR-2.
- Obtain Digital Signature Certificates (DSC): If the proposed directors don’t have DSCs, they must apply for them.
- Obtain Director Identification Number (DIN): If the suggested director doesn’t have a DIN, apply for it using Form DIR3. DIN is valid indefinitely and open to individuals above 18, regardless of nationality.
- Collect Documents: Gather KYC documents and educational background proof as per job requirements. There’s no minimum educational qualification needed to be a director in India.
Who is a Director in a Private Limited Company?
- Definition: A director in a private limited company is an individual appointed to the company’s board under the Companies Act, 2013.
- Role: Directors are part of the Board of Directors, chosen by shareholders to oversee the company’s functions.
- Agency: As a legal entity, a company can only operate through living individuals, known as directors, who act on its behalf.
- Responsibilities: Directors administer, regulate, and direct company affairs, exercising control over its management.
- Appointment: Directors are either designated or elected by law to manage and supervise the company’s operations, as entrusted by shareholders.
Types of Director in Company
Managing Director:
- Appointed as per company’s articles, contract, resolution, or board decision.
- Holds significant authority over company operations.
Whole-time Director or Executive Director:
- Engaged in full-time employment with the company.
Ordinary Director:
- Participates in board meetings and decisions, but not in a managing or full-time capacity.
Additional Director:
- Appointed by the Board between annual general meetings.
- Term lasts until the next annual general meeting.
- Typically used to fill temporary vacancies or represent foreign interests.
Professional Director:
- Has professional qualifications but no financial stake in the company.
- Brings expertise in business management to the board.
Nominee Director:
- Appointed by banks or private equity investors who provide equity support.
- Represents the interests of the appointing entity on the board.
- Sometimes appointed in one-person companies to manage affairs in case of incapacity or death of the sole director.
Maximum and Minimum Number of Directors in Private Limited Company
Minimum and Maximum Number of Directors:
- Private Limited Company: Must have at least two directors, with a maximum of fifteen.
- Limited Company: Requires a minimum of three directors.
- One Person Company: Can function with just one director.
Residency Requirement for Directors in Private Limited Company:
- No restrictions on appointing foreign nationals or NRIs as directors.
- At least one director must have resided in India for at least 182 days in the previous calendar year.
Women Director Requirement:
- Listed companies and those with a paid-up share capital of Rs. 100 crore or more, or a turnover of Rs. 300 crore or more, must appoint at least one woman director.
Add Directors FAQs
Directors manage operations, make strategic decisions, and ensure compliance with shareholder expectations.
To accommodate growth, bring in expertise, or meet shareholder demands for agility and competitiveness.
IndiaFilings offers comprehensive support, from compliance reviews to guiding through regulatory filings.
Executive, Non-Executive, and Independent directors with distinct roles and responsibilities.
Minimum two, maximum fifteen, extendable through special resolution.
Sections 149, 152, 161, and 164 of the Companies Act, 2013 outline appointment procedures and qualifications.
New skills, strategic control, board performance, and legal compliance are common factors.
Over 18, not disqualified under the Companies Act, and agreement for appointment.
PAN Card, proof of identity and residence, photograph, and Digital Signature Certificate.
Reviewing the company's AOA to ensure it allows for director additions.
Through a resolution at a General Meeting (AGM or EGM) as per company needs.
Unique identifier required for director appointments, ensuring legal compliance.
Consent form from prospective director, indicating willingness to take on the role.
Outlines terms, roles, and responsibilities, formalizing the appointment.
Form DIR-2 (consent) and Form DIR-12 (particulars of appointment) filed with the ROC within 30 days.
Maintains accurate records of board members, reflecting current management.
Updates required with GST Network and tax authorities for compliance.
By providing expert guidance, ensuring compliance, and facilitating smooth expansions.
Connect with Filling Champs for streamlined, compliant processes.
