Companies Act, 2013
169.
Removal
of directors.
1. A company may, by
ordinary resolution, remove a director, not being a director appointed by the
Tribunal under section 242, before the expiry of the period of his office after
giving him a reasonable opportunity of being heard:
Provided
that nothing contained in this sub-section shall apply where the company has
availed itself of the option given to it under section 163 to appoint not less
than two thirds of the total number of directors according to the principle of
proportional representation.
1.
2. A special notice
shall be required of any resolution, to remove a director under this section,
or to appoint somebody in place of a director so removed, at the meeting at
which he is removed.
3. On receipt of notice
of a resolution to remove a director under this section, the company shall
forthwith send a copy thereof to the director concerned, and the director,
whether or not he is a member of the company, shall be entitled to be heard on
the resolution at the meeting.
4. Where notice has been
given of a resolution to remove a director under this section and the director
concerned makes with respect thereto representation in writing to the company
and requests its notification to members of the company, the company shall, if
the time permits it to do so,—
a.
in
any notice of the resolution given to members of the company, state the fact of
the representation having been made; and
b.
send
a copy of the representation to every member of the company to whom notice of
the meeting is sent (whether before or after receipt of the representation by
the company), and if a copy of the representation is not sent as aforesaid due
to insufficient time or for the company’s default, the director may without
prejudice to his right to be heard orally require that the representation shall
be read out at the meeting:
Provided
that copy of the representation need not be sent out and the representation
need not be read out at the meeting if, on the application either of the
company or of any other person who claims to be aggrieved, the Tribunal is
satisfied that the rights conferred by this sub-section are being abused to
secure needless publicity for defamatory matter; and the Tribunal may order the
company’s costs on the application to be paid in whole or in part by the director
notwithstanding that he is not a party to it.
1.
2.
3.
4.
5. A vacancy created by
the removal of a director under this section may, if he had been appointed by
the company in general meeting or by the Board, be filled by the appointment of
another director in his place at the meeting at which he is removed, provided
special notice of the intended appointment has been given under sub-section (2 ).
6. A director so
appointed shall hold office till the date up to which his predecessor would
have held office if he had not been removed.
7. If the vacancy is not
filled under sub-section (5 ), it may be filled as a casual vacancy in
accordance with the provisions of this Act:
Provided
that the director who was removed from office shall not be re-appointed as a
director by the Board of Directors.
1.
2.
3.
4.
5.
6.
7.
8. Nothing in this
section shall be taken—
a.
as
depriving a person removed under this section of any compensation or damages
payable to him in respect of the termination of his appointment as director as
per the terms of contract or terms of his appointment as director, or of any
other appointment terminating with that as director; or
b.
as
derogating from any power to remove a director under other provisions of this
Act.