Resignation of old & appointment of new director

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Querist : Anonymous

Querist : Anonymous (Querist)

05 September 2013 Hi, I have a query that in case of a private limited company, how to retire a director & appoint new one and also transfer the share of old director to new director. what are the form required for this procedure.

Ajay Mishra

Ajay Mishra (Expert)
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05 September 2013
Procedure for Appointment of Additional Directors.

1. Take consent of director and DIN/disclosure of interest
2. Call a Board Meeting for proposal of appointment of director
3. Hold a Board Meeting and appoint him as additional director.
4. File Form-32, with ROC, with in 30 days from the date of appointment.
5. Attach consent letter with Form-32, in case of public limited company.
6. Take entry in Minutes.

Ajay Mishra

Ajay Mishra (Expert)
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05 September 2013
Appointment and resignation of Director

In this situation u can take the following route:

1. Convey a Board Meeting
2. In Board Meeting u first appoint additional director
3. There after u can resign the existing directors
4. Authorize new director to sign and file forms with MCA and other authorities.
5. File Form 32 of appointment of directors with concerned ROC and take approval from ROC.
6. After approval of Form-32 regarding appointment, u can file Form-32 regarding resignation of directors
7. You try to give effect of resignation of director from the date of Board Meeting or thereafter, otherwise appointment of new directors will be null and void.
8. Convey a Board Meeting for calling general Meeting for regularization of existing additional directors
9. File Form -32 regarding change in designation of existing director.

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Ajay Mishra

Ajay Mishra (Expert)
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05 September 2013
PROCEDURE FOR TRANSFER OF SHARES OF PRIVATE COMPANY

Generally articles contain the detailed provisions as regards the procedure for transfer of shares. Usually following steps shall be followed by a private company to give effect to the transfer of shares:—
(i) Transferor should give a notice in writing for his intention to transfer his share to the company.
(ii) The company in turn should notify to other members as regards the availability of shares and the price at which such share would be available to them.
(iii) Such price is generally determined by the directors or the auditors of the company.
(iv) The company should also intimate to the members, the time limit within which they should communicate their option to purchase shares on transfer.
If none of the members comes forward to purchase shares then the shares can be transferred to an outsider and the company will have no option, other than to accept the transfer.
(V) the transferor will submit the following documents with company:
(a) Original Share certificate
(b) Transfer deed (Form-7B) properly executed with stamp duty of proper amount.
© any other documents relating thereto.

It is to be noted that any transfer of shares to an outsider without complying with the procedure as specified in the articles for effecting transfer of shares will not be operative against the company.

Even in the case where the procedure prescribed by the articles was not followed and such failure was not due to any fault on the part of the selling shareholder, the transfer to an outsider was held not to be effective.

Transfer of shares without consent of holder of shares and without prior sanction of board of directors as required under articles of association of a private company concerned could not be held to be valid. [John Tinson Co. (P) Ltd. v Mrs. Surjeet Malhan (1997) 88 Comp Cas 750 (SC)].

Querist : Anonymous

Querist : Anonymous (Querist)

05 September 2013 Thank you so much sir, But existing no. of directors are 5, is there any problem if we retire 1 director first then appoint fresh director. As the director is suppose to go abroad soon, so kindly mention the documents in which his signature required, so that at one meeting all the formalities cleared.

Ajay Mishra

Ajay Mishra (Expert)
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05 September 2013 No problem if he is resign.

You take resignation letter from such director who is going to resign.

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Querist : Anonymous

Querist : Anonymous (Querist)

05 September 2013 Is there any sample letter. If so kindly provide it. The only signature required is that on Resignation letter, and he is also having share in that company. So what in case of share transfer means documents in which signature required. The new director want to acquire share that of resigning.

Ajay Mishra

Ajay Mishra (Expert)
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05 September 2013 In case of transfer of shares, you will take him original share certificate and signed Form-7B(transfer deed).

Ajay Mishra

Ajay Mishra (Expert)
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05 September 2013
The Board of Directors
...... Limited
Address.....

SUB: RESIGNATION FROM THE OFFICE OF DIRECTOR

This is to inform you that I am not able to devote time to the company due to my various other preoccupations, hence I submit my resignation from the Board of Director of the Company.

I wish the company continuing success in the years to come.

Thanking You

Yours Truly

...
Name of Director

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