Section 152: Appointment of Directors

Applicability of Section 152:  Public Company only, not applicable on private company or Government Company.

Appointment of First Directors

If no provision in articles: The subscribers to the memorandum being individuals shall be deemed to be the first directors of the company until the directors are duly appointed

One Person Company: Individual being the member shall be the first director unless the director is duly appointed by the member as per the provisions of this section.

Appointment: Every Director shall be appointed at the Annual General Meeting of the Company.

DIN: Director Identification Number (DIN) u/s 154 is compulsory before appointing an individual as a Director.

Declaration of Disqualification: Every person being appointed as a Director in the Annual General Meeting must furnish a declaration that he is not disqualified to be a director u/s 164(1) of Companies Act, 2013

Consent by the Director to Company and to ROC: The Director so appointed shall not hold the office until he gives his consent to the Company in Form DIR-2 and such consent has been filed to ROC in form DIR-12 within 30 day of his appointment.

For appointment of Independent Director in Annual General Meeting, the explanatory statement shall be attached along with the notice of General Meeting declaring that he fulfills the conditions in the opinion of the Board as specified in the Act.

Retirement of Directors

Unless the articles provide for retirement of all the Directors at every Annual General Meeting of the Company, not less than 2/3^rd of the total number of Directors of the Public Company shall be the persons whose period of office is liable to determination by retirement of Directors by rotation;

The remaining Directors, i.e. 1/3^rd of the total number of directors shall be appointed by the company in the Annual General Meeting.

In case of Public Company, at every Annual General Meeting, including the first Annual General Meeting of the Company, 1/3^rd of such number of directors (2/3^rd liable to retire) shall retire from the office.

However, if their number is 3 or not in multiple of 3, the number nearest from 1/3^rd shall retire from the office.

The directors to retire by rotation shall be those who have served for the longest period in the office since their last appointment, but in case of persons who were appointed on the same day, subject to any agreement between themselves, be determined by the lot.

The Annual General Meeting where a Director retires as aforesaid, the company may fill up the vacancy by appointing a retiring director (retiring by rotation) or some other person to the Board.

The total number of directors shall not include Independent Directors.

Adjournment of Meeting

In case the vacancy of the retiring directors (retiring by rotation) is not filled and the annual general meeting has not expressly resolved not to fill the vacancy, the meeting shall stand adjourned.

However, where the director is not appointed even in the adjourned meeting, and the meeting has not expressly resolved to not to fill the vacancy, the retiring directors (retiring by rotation) shall be deemed to have been reappointed at the adjourned meeting unless –

1.  The resolution for re-appointment has been put to the meeting and lost;
2.  Expressed unwillingness to be re-appointed;
3. Not qualified or disqualified;
4. Where special or ordinary resolution is required for appointment or re-appointment;
5. Appointment u/s 162 of the Act (appointment of the directors to be voted individually)

References:

SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

Contact:

CS Divyanshu Bansal

Ph: +91-9958381905

Email ID: divyanshubansal401@gmail.com