Skip links

How to Appoint a Director in a Company?

Introduction

Here is a guide to inform you about “How to appoint a director in a company”. Well, before that it is very important to understand why appointing a director in a company is necessary. So, let’s get started by learning by some extraordinary knowledge and then come to the main aspect.

Why to appoint a director?

A director is the one having supreme authority to control the management and affairs of a company. And all the directors appointed in the company constituted is known as “Board of Directors”. Talking about the Board of Directors (BOD), they are known to be a group of trustworthy and respectable people that can look after the interest of the large number of shareholders not directly involved in the company.

So, just think what if there is no director in a company? Would that company be working or running for a long? Obviously not. That is the reason why directors being an essential part of the company is required to be appointed.

After being cleared with the reason of appointing a director in a company, let us now get into detail to learn “How to appoint a director in a company?”.

Director

As per Section 2(34) of the Companies Act, “Director” means a director appointed to the Board of the company. Thus, a director is a person appointed to perform the duties and functions of a company in accordance with the Companies Act 2013.

In a company there are various types of directors like first director, alternate director, director appointed by nomination, director appointed in casual vacancy and many other. For make it short and to the point, here we will be talking about the general process of appointing a director of a company.

Let us now come to the main aspect of the process of how to appoint a director in a company,

Process of Appointment of Director

The process involved in the appointment of director in a company is as follows:-

Step 1 : Obtaining DSC and DIN

DSC is what is the most essential thing for appointments and also for filing documents with MCA. The Digital Signature Certificate is known as an electronic signature that comes in use while filing on MCA Portal.

DIN i.e. Director Identification Number is a unique identification number allotted to every director of the company. It helps MCA in maintaining information and records of every director of the company. It is obtained by filing form DIR-3.

DSC and DIN, both is the primary aspect for appointing a director in a company.

Step 2 : Conduct a general meeting

A general meeting is required to be conducted where a resolution shall be passed for appointing a director in the company. Where the appointment of director is to be made in the middle of the year with the immediate effect then, EGM can be conducted.

However, for conducting an extraordinary general meeting, the company will be required to file the appoint of director in Form MGT-14 with ROC (Registrar of Companies) within 30 days of passing the resolution.

Step 3 : Consent from the proposed director

The person wishing to become a director in the company is required to give his/her consent to act as a director in form DIR-2. This step cannot be ignored in any case as without the approval of the proposed director, appointment of director cannot take place.

Step 4 : File with ROC

Once the resolution is passed for appointment of director and consent is received, the filing process shall begin. So, now the company is responsible to file form DIR-12 (Appointment of Director) and DIR-2 (Consent of the Director) after appointing the director. Also, one thing must be kept in mind, that the filing of these forms must be done within 30 days of the appointment itself.

General Provisions for Appointment of Director

  1. Appointment of every director shall be held while conducting a general meeting of the company. General meetings can either be Annual General Meeting (AGM) or Extraordinary General Meeting (EGM) as the case may be.
  2. Appointment of Director shall be said to be valid only if the director is holding a DIN i.e. Director Identification Number. It means that if a person wanting to become a director must apply for DIN and then only he or she can be a director in a company.
  3. A declaration is necessary to be submitted by the person proposed to a director of the company that he or she is not disqualified to become a director.
  4. Consent in DIR-2 form is also to be submitted by the proposing director on or before the appointment in order to hold the office in physical form. After that company shall be filing the form for appointing a director along with form DIR-2 within a specified time.

Documents Required for Appointment of Director

Here are some of the essential documents required for appointing a director in a company. The necessary documents are as follows:-

  • Passport (mandatory in case of foreign applicant)
  • PAN Card to be presented for identity proof
  • Proof of residence (electricity bill, rental agreement, Aadhaar Card, Voter ID, passport, driving license)
  • Passport size photograph
  • Digital Signature Certificate (DSC)
  • Director Identification Number (DIN)

Want to become a director in a company?

To become a director in a company, there is no as such qualifications or eligibility given under the Act. However, some of the disqualification are given.

In simple, if you are an individual above 21 years of age then you are eligible to be appointed as a director of the company. But, be careful as an artificial person like company, firm cannot be appointed as director of the company.

Final Words

If you still have any doubts, then please feel free to consult EAdvisors. We are always there for you, with you. We are available at 9910000833 or you may drop you query at info@eadvisors.in. We will be grateful to have you on board with us.

[ld_spacer height=”22px” md_height=”30px”][ld_banner show_button=”yes” ib_style=”btn-default” ib_title=”For Appointment of Director” use_custom_fonts_title=”true” title=”Contact EAdvisors” ib_link=”url:https%3A%2F%2Feadvisors.in%2Fappointment-of-director%2F||target:%20_blank|” image=”15947″ bg_color=”rgb(0, 0, 0)” title_color=”rgb(255, 255, 255)” ib_css=”.vc_custom_1676359491701{background-color: #c7d8d5 !important;}”]

Leave a comment

🍪 This website uses cookies to improve your web experience.