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Upon successful Change in Director of a Company in India, following steps are typically undertaken to reflect the change
Filing of Form DIR-12
Updating Company Records
Other Documents ( if Any)
Table of Contents
Change in Director of a Company Online Certified Service by MyCAfiling- Name, Secretary & Address
hanging the director of a company is a significant decision that requires careful consideration and a clear understanding of the legal requirements and procedures involved. Whether it’s due to resignation, removal, or the addition of new expertise to the board, a change in director can impact the company’s operations and compliance.
In this comprehensive guide, we will walk you through the entire process of a change in director of a company, the legal requirements, the necessary documentation, and the role of MyCAfiling in facilitating this process at the lowest cost.
Understanding the Role of Directors
Directors play a crucial role in the management and governance of a company. They are responsible for making strategic decisions, overseeing the company’s operations, and ensuring compliance with legal and regulatory requirements. A change in director can occur for various reasons, including:
- Resignation of a director
- Appointment of a new director
- Removal of an existing director
- Death of a director
- Retirement of a director
Legal Requirements for Change in Director of a Company
To ensure a smooth transition and compliance with the law, it’s essential to follow the prescribed procedures for a change in director of a company. The Companies Act, 2013, outlines the requirements and steps for making such changes. Here are the key legal requirements:
1. Board Resolution
The first step in the process is to convene a board meeting to pass a resolution for the change in director. The board resolution should include the following details:
- Name of the outgoing director (in case of resignation or removal)
- Name of the incoming director (in case of appointment)
- Effective date of the change
- Authorization for the company secretary or any director to file the necessary forms with the Registrar of Companies (RoC)
2. Filing of Form DIR-12
Once the board resolution is passed, the next step is to file Form DIR-12 with the RoC. This form must be filed within 30 days of the board resolution. Form DIR-12 includes details of the outgoing and incoming directors, along with their consent and declarations. The following documents must be attached to Form DIR-12:
- Copy of the board resolution
- Notice of resignation (if applicable)
- Consent to act as a director (for the new director)
- Proof of identity and address of the new director
3. Updating Registers and Records
After filing Form DIR-12, it’s important to update the company’s registers and records to reflect the change in director. This includes:
- Register of Directors and Key Managerial Personnel
- Register of Members (if the director is also a shareholder)
- Statutory registers and records as required by the Companies Act, 2013
4. Intimation to Stakeholders
The company should inform all stakeholders, including employees, shareholders, clients, and business partners, about the change in director. This helps ensure transparency and maintain trust in the company’s management.
Procedure for Change in Director of a Company
Now that we understand the legal requirements, let’s delve into the detailed procedure for a change in director of a company:
Step 1: Convene a Board Meeting
The process begins with convening a board meeting to discuss and approve the change in director. The agenda of the meeting should include:
- Discussion on the resignation or removal of the existing director
- Appointment of the new director
- Passing the board resolution
Step 2: Pass the Board Resolution
During the board meeting, the directors should pass a resolution for the change in director. The resolution should be documented in the minutes of the meeting and signed by the chairman of the meeting.
Step 3: Obtain Consent and Declarations
If a new director is being appointed, their consent to act as a director and declarations should be obtained. The new director must provide:
- Form DIR-2 (Consent to act as a Director)
- Form DIR-8 (Intimation by Director about Disqualification)
- Copy of PAN card
- Proof of identity (Aadhar card, passport, or driving license)
- Proof of address (electricity bill, bank statement, or telephone bill)
Step 4: File Form DIR-12
The next step is to file Form DIR-12 with the RoC within 30 days of passing the board resolution. The form should be digitally signed by a director or the company secretary and certified by a practicing professional (chartered accountant, company secretary, or cost accountant). The following documents should be attached to Form DIR-12:
- Copy of the board resolution
- Notice of resignation (if applicable)
- Consent to act as a director (Form DIR-2)
- Proof of identity and address of the new director
Step 5: Update Company Registers and Records
Once Form DIR-12 is filed, update the company’s registers and records to reflect the change in director. This includes:
- Register of Directors and Key Managerial Personnel
- Register of Members (if the director is also a shareholder)
- Statutory registers and records as required by the Companies Act, 2013
Step 6: Inform Stakeholders
Inform all stakeholders, including employees, shareholders, clients, and business partners, about the change in director. This helps ensure transparency and maintain trust in the company’s management.
Role of MyCAfiling in Change in Director of a Company
Changing the director of a company can be a complex and time-consuming process. MyCAfiling simplifies this process by providing comprehensive services for change in director of a company at the lowest cost. Here’s how MyCAfiling can help:
1. Expert Guidance
MyCAfiling’s team of experienced professionals provides expert guidance throughout the process, ensuring compliance with legal requirements and timely completion of all formalities.
2. Document Preparation
MyCAfiling assists in preparing all necessary documents, including board resolutions, consents, and declarations, ensuring accuracy and completeness.
3. Filing of Forms
MyCAfiling handles the filing of Form DIR-12 and other required forms with the RoC, ensuring timely submission and compliance.
4. Updating Registers and Records
MyCAfiling helps update the company’s registers and records, ensuring they reflect the change in director accurately.
5. Stakeholder Communication
MyCAfiling assists in drafting communication to inform stakeholders about the change in director, ensuring transparency and maintaining trust.
Benefits of Using MyCAfiling for Change in Director of a Company
Using MyCAfiling for changing the director of a company offers several benefits:
1. Cost-Effective Services
MyCAfiling offers the lowest cost services for change in director of a company, making it affordable for businesses of all sizes.
2. Hassle-Free Process
MyCAfiling handles all the complexities and formalities involved in changing the director, ensuring a hassle-free experience for the company.
3. Timely Completion
MyCAfiling ensures timely completion of all formalities, minimizing any disruption to the company’s operations.
4. Compliance Assurance
With MyCAfiling, you can be assured of full compliance with legal and regulatory requirements, reducing the risk of penalties and legal issues.
5. Professional Support
MyCAfiling’s team of professionals provides continuous support and guidance throughout the process, ensuring a smooth transition.
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FAQ (Frequently Asked Questions)
How long does it take to change the director of a company?
The process of changing the director of a company typically takes 7-10 days, depending on the timely submission of documents and approvals.
Can a director be removed without their consent?
Yes, a director can be removed without their consent through a special resolution passed by the shareholders in a general meeting, following the procedures outlined in the Companies Act, 2013.
What is Form DIR-12?
Form DIR-12 is a form filed with the Registrar of Companies to notify about the appointment, resignation, or change in directors of a company.
Is it mandatory to update the company’s registers after changing a director?
Yes, it is mandatory to update the company’s registers and records to reflect the change in director, as required by the Companies Act, 2013.
Can a company have more than one director?
Yes, a company can have multiple directors. The minimum number of directors required for a private limited company is two, and for a public limited company, it is three.
What documents are required for appointing a new director?
The documents required for appointing a new director include Form DIR-2 (Consent to act as a Director), Form DIR-8 (Intimation by Director about Disqualification), proof of identity, and proof of address.
What is the role of a company secretary in changing a director?
The company secretary plays a crucial role in preparing and filing the necessary documents, updating registers and records, and ensuring compliance with legal requirements.
Can a director resign voluntarily?
Yes, a director can resign voluntarily by submitting a resignation letter to the board of directors and filing