Appointment & removal of directors & transfer of shares

Save Share

This query is : Resolved

Swasti Purohit (Querist)

20 September 2014 A private limited company with 3 directors wants to remove 2 old directors & introduce 2 new directors & simultaneously transfer the shares of old 2 directors to 2 new directors.

Can removal & introduction of directors be done in 1 board resolution?

Ankur Garg

Ankur Garg (Expert)

21 September 2014 As per my opinion you can do it in single board meeting.

With the help of existing 3 directors you may transfer the shares to 2 persons. For becoming shareholders it is not required to be a director of the Company.

In the same meeting appoint 2 new Directors. For ROC filing purpose first file form DIR.12 for appointment of director.

After approval of said form DI.12 file forms related to resignation of directors.

Thanks

Ankur Garg

Ankur Garg (Expert)

21 September 2014 Check the links below for Procedure for appointment and resignation of Directors:

https://www.caclubindia.com/articles/procedure-for-appointment-of-additional-director-in-ca-2013-20653.asp

https://www.caclubindia.com/articles/procedure-for-resignation-of-director-under-ca-2013-21155.asp#.U89qraO816Y

Thanks

Message likes : 2 times

Ankur Garg

Ankur Garg (Expert)

21 September 2014 To know everything about transfer of shares under Companies act 2013 kindly see the link below:

https://www.caclubindia.com/articles/procedure-for-transfer-of-shares-under-companies-act-2013-21623.asp#.VA1SK6NqOZQ

Thanks

Message likes : 1 times

Swasti Purohit

Swasti Purohit (Querist)

21 September 2014 The issue is that there are 3 directors in the board (first directors).
shareholding is as follows
Dir A: 40%
Dir B & C: 30% each
Now B & C wish to leave. New directors D & E will be introduced in their place.
And the shares will be transferred.
Later on, Dir A will hold 98% and D & E will hold 1% shares each.

Please suggest.
Will the appointment & removal of directors will be through resolution passed in meeting of Board of Directors? These resolutions will have to filed through MGT-14 also?
Also, when is MBP-1 required to be filed in MGT-14?

Swasti Purohit

Swasti Purohit (Querist)

Ankur Garg

Ankur Garg (Expert)

21 September 2014 Yes appointment and resignation of director will be through board resolution. But in the process of appointment and resignation MGT.14 is not required to be filed. You are advised to go through my articles as listed above.

Thanks

Ankur Garg

Ankur Garg (Expert)

21 September 2014 Further MBP.1 is not required to be filed with MGT.14.

Disclosure of Interest by Directors under CA, 2013

As per section 184(1) of Companies Act, Every director shall:

(i.) At the first meeting of the Board in which he participates as a director; and thereafter
(ii.) At the first meeting of the Board in every financial year or
(iii.) Whenever there is any change in the disclosures already made, then at the first Board meeting held after such change,

disclose his concern or interest in any company or companies or bodies corporate, firms, or other association of individuals which shall include the shareholding, in such manner as may be prescribed.

Form MBP.1
As per section 184(1) read with rule 9(1) of Companies (Meetings of Board and its Powers) Rules, 2014,Every director shall disclose his concern or interest in any company or companies or bodies corporate (including shareholding interest), firms or other association of individuals, by giving a notice in writing in Form No. MBP 1.

Requirement of filing form MGT.14 for disclosure of interest by Director

As per Section 117(1), certain resolutions and agreements as required by section 117(3) are required to be submitted with ROC through filing form MGT.14. Section 117(3) also refers matter given in section 179(3) are also required to be reported via MGT.14.

As per section 179(3)(k) read with rule 8(5) of Companies (Meetings of Board and its Powers) Rules, 2014, taking note of the disclosure of director’s interest and shareholding shall be done by the Board only by means of resolutions passed at meetings of the Board. Hence it is duty of the company to pass board resolution to take note of disclosure of interest by Director and file a copy of that board resolution in MGT.14. within 30 days of passing board resolution.

Now it is almost established that form MBP.1 regarding disclosure of director’s interest is not required be attached through form MGT.14 along with copy of resolution passed u/s 184(1). However, as per my opinion there is no harm in attaching form MBP.1withMGT.14along with copy of board resolution though there is no compulsion as far as language of form MGT.14 is concerned.

Thanks

Ankur Garg

Ankur Garg (Expert)

21 September 2014 To know everything about disclosure of interest by director through form MBP.1 under section 184 kindly read my article below:

https://www.caclubindia.com/articles/analysis-of-disclosure-of-interest-by-directors-under-ca-2013-21752.asp

Thanks

Message likes : 1 times

Swasti Purohit

Swasti Purohit (Querist)

21 September 2014 I want to appoint director in The Board and not additional director as additional director will hold office till next AGM.

Please clarify this.

Ankur Garg

Ankur Garg (Expert)

21 September 2014 No issue swati.

Simply appoint him by passing a resolution in general meeting.

Form filing for appointment and document collection from proposed director shall remain the same.

Thanks

Swasti Purohit

Swasti Purohit (Querist)

21 September 2014 Can i get sample resolution>

Ankur Garg

Ankur Garg (Expert)

21 September 2014 RESOLVED THAT pursuant to the provisions of Section 152(2) and other applicable provisions of the Companies Act 2013, consent of the members of the Company be and is hereby accorded to appoint Mr. Vinay Mittal as Director of the Company w.e.f. September 21, 2014 on such remuneration and terms and Conditions of appointment as may be decided by the Board of Directors in consultation with Mr. Vinay Mittal.

FURTHER RESOLVED THAT for the purpose of giving effect to this resolution, Mr. Manoj Agarwal, Director of the Company be and is hereby authorised, on behalf of the Company, to do all acts, deeds, matters and things as deem necessary, proper or desirable and to sign and execute all necessary documents, applications and returns for the purpose of giving effect to the aforesaid resolution along with filing of necessary E-form as return of appointment with the Registrar of Companies, NCT of Delhi and Haryana.”

Swasti Purohit

Swasti Purohit (Querist)

21 September 2014 So as per my understanding following is the solution:
Appointment of 2 new directors in general meeting (this will make no of directors as 5).
Removal of 2 old directors & Transfer of shares by them in board meeting.

IS it right?

Ankur Garg

Ankur Garg (Expert)

21 September 2014 Your observation is right now keeping in view the provisions of CA 2013.

Swasti Purohit

Swasti Purohit (Querist)

21 September 2014 Okay. Thanks a lot! Helped a lot.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now