Company Law

Vacation of office of Director [S. 167]

1.

Triggers for vacation of office of a director
[S. 167(1)]
  1. he incurs any of the disqualifications specified in S. 164;
    • If disqualification u/s 164(2) ⟶ he vacates the office from all other Cos; but he does not vacate from the Co which has failed or defaulted u/s 164(2)
  2. Absents from all BMs held during 12 months with/without seeking leave of absence of BoD;
  3. he contravenes the provisions of S. 184 relating to entering into contracts or arrangements in which he is directly or indirectly interested;
  4. he fails to disclose his interest in any contract or arrangement in which he is directly or indirectly interested, in contravention of the provisions of S. 184;
  5. he becomes disqualified by an order of a court or Tribunal;
  6. he is convicted by a court of any offence, whether involving moral turpitude or otherwise and sentenced in respect thereof to imprisonment for not < 6 months:
    • the office shall not be vacated by the director in case of orders referred to in clauses (e) and (f)-
      • for 30 days from the date of conviction or order of disqualification;
      • where an appeal or petition is preferred within 30 days as aforesaid against the conviction resulting in sentence or order ⟶ until expiry of 7 days from the date on which such appeal or petition is disposed of; or
      • where any further appeal or petition is preferred against order or sentence within 7 days ⟶ until such further appeal or petition is disposed of
  7. he is removed in pursuance of the provisions of Co Act 2013;
  8. he, having been appointed a director by virtue of his holding any office or other employment in the holding, subsidiary or associate Co, ceases to hold such office or other employment in that Co

2.

Steps after vacation of office of director as mentioned above [S. 167(3)]

Where all the directors of a Co vacate their offices under any of the disqualifications specified in S. 167(1) ⟶ the promoter or, in his absence, CG shall appoint the required number of directors who shall hold office till the directors are appointed by the Co in the GM