Vacaton of office as director under section 167

Hello Experts,

Section 167 states the circumstances under which a director shall vacate his office. One among the situation is his failure to disclose his interest in any contract in which such director is interested. On account of such failure, whether he is liable to vacate his office of that company only or he should vacate the office of all companies in which he is a director. If he is a director in 5 companies in total, whether from 5 companies he should vacate? Kindly clarify

Thanks in advance. 

Replies (3)
Quick Summary
This discussion clarifies the implications of Section 167 regarding director office vacation. It addresses whether a director failing to disclose an interest in a company contract must vacate their office from all directorships or just the one where the default occurred. The consensus suggests that a failure to disclose interest typically leads to vacating the office only in the specific company where the contravention happened, unlike disqualifications under Section 164(2) which can affect all directorships.

Yes except u/s 164(2) where he will have to vacate all the offices except the office which have failed to comply the requirements stated therein. in all other he will have to vacate all the offices
No, Non disclosure of interest in any contract or arrangement entered by the company, then his office as director become vacant only in the company in which he contravened 184.Its contrary 167(1) First proviso where on getting disqualification u/s164 then he will be deemed to vacate office from all companies except in defaulting one.

That person who fails to disclose his interest directly or indirectly in the contract and arrangement entered into with the company, he shall have to vacate from the position of directorship only from the concerned in which such default had occurred not from the others company where he holds the position of director. 

Another aspect  for the vacation from the other company in which no default has occurred for the filing of financial, annual return or default to debt repayment..... As mention in section 164(2)clause a and b read with proviso to section 167(1)(a). 

 

 

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
16 September 2026
Internal Audit - Team Lead

Consulting & Beyond

Chennai

CA

View Details
Company
ARTICLESHIP 07 October 2026
Article Trainee/ CMA Trainee

RMA And Associates LLP

New Delhi

CA Inter

View Details
Company
10 October 2026
Accounts Associate Level 1

Abic and Mani Chartered Accountants

Kottayam

B.Com

View Details
Company
Featured 21 September 2026
Consultant - Reporting

Finrep Advisors LLP

Mumbai

CA

View Details
Company
ARTICLESHIP 21 September 2026
CA Article Assistant

KK & Company Chartered Accountant

Pune

CA Inter

View Details
Company
14 October 2026
GST & TDS ASSISTANT

AGGARWAL SANJAY & ASSOCIATES

New Delhi

B.Com

View Details
Company
20 September 2026
Semi Qualified CA

Navin & Associates

Mumbai

CA Inter

View Details
Company
07 October 2026
Senior Account Manager

Amplio Invest

Mumbai

M.Com

View Details