CONTENTS:

DEFNTTON OF DRECTOR
NO OF DRECTORS
APPONTMENT OF DRECTORS
POSTONOF DRECTORS
RESTRCTONS ON APPONTMENT OF DRECTORS
NO OF DRECTORSHP
DSQUALFCATON OF DRECTORS
EFINITION OF IRECTOR: (sec 2(13))
A director may be defined as a person having control over the direction
,conduct ,management (or ) superintendence of the affairs of a company.
NO OF IRECTORS:
Public company - 3.
Private company - 2.
INCREASE OR RE&CTION IN N&ER OF
IRECTORS : (sec 258)
The articles of a company prescribe the max and min number of directors for its
board of directors. The no so fixed may be increased or decreased with in limits
prescribed by the articles by an ordinary resolution of the company in general
meeting.
SANCTIONE THE CENTRAL GOVERNENT:
Any increase in no of directors beyond the max permitted by the articles
shall be approved by the central government.
ACIN1MLN1 CI DIkLC1CkS
1 IIkS1 DIkLC1CkS(sec 2S4 and c|ause 64 of 1ab|e A)
(a) 1he arLlcles of company usually name Lhe flrsL dlrecLors by Lhelr respecLlve names
(b) lf Lhe flrsL dlrecLors are noL named ln Lhe arLlcles Lhe no of dlrecLors and names shall be
deLermlned by Lhe subscrlbers of Memorandum
(c) lf Lhe flrsL dlrecLors are noL appolnLed ln Lhe above manner Lhe subscrlbers of
memorandum who are lndlvlduals become Lhe dlrecLors
2ACIN1MLN1 CI DIkLC1CkS 8 1nL CCMAN (sec 2SS to 2S7
263 and 264 )
ulrecLors musL be appolnLed by share holders ln genral meeLlngs ln case of a publlc subsldlary
company aLleasL 2/3
rd
of Lhe LoLal no of dlrecLors shall be appolnLed by Lhe share holders
3ACIN1MLN1 CI DIkLC1CkS 8 DIkLC1CkS (sec 260262313)
(a)AS ADDI1ICNAL DIkLC1CkS (sec 260)
Any addlLlonal dlrecLors appolnLd by Lhe dlrecLors shall hold offlce upLo only Lhe daLe of nexL
annual general meeLlng
(b)IN A CASUAL VACANC (sec 262)
ln case of publlc subsldlary company lf dlrecLor appolnLed by ln genral meeLlng ls vacaLed
before hls Lerm of offlce explres ln normal course Lhe resulLlng casual vacancy wlll be fllled by
board of dlrecLors ln general meeLlngs
(c )AS AL1LkNA1L DIkLC1Ck (sec 313)
As alLernaLe dlrecLor can be appolnLed by Lhe board lf lL ls so auLhorlsed by
(l)arLlcles of a company
(ll)a resoluLlon caused by Lhe company ln genral meeLlng
APPOINTENT OF IRECTORS THIR PARTIES:
The articles under certain circumstances give power to the debenture holders or other
creditors.
5APPOINTENT PROPORTIONAL REPRESENTATION:
1he arLlcle may provlde for Lhe appolnLmenL of noL less Lhan 2/3
rd
of LoLal dlrecLors
of publlc subsldlary company accordlng Lo Lhe prlnclple of proporLlonal
represenLaLlon
6ACIN1MLN1 CI DIkLC1CkS 8 1nL CLN1kAL GCVLkNMLN1
AppolnLmenL such no of dlrecLors on board of a company as Lhe Lrlbunal may by
order ln wrlLlng speclfy as necessary Lo effecLlvely safeguards Lhe lnLeresLs of Lhe
company or lLs share holders or publlc lnLeresL
CSI1ICN CI DIkLC1CkS
(a)DIkLC1CkS AS AGLN1S
ulrecLors are ln Lhe eyes of law agenLs of a company for whlch Lhey acL and Lhe general
prlnclples of Lhe law of prlnclpal and agenL regulaLe ln mosL respecLs Lhe relaLlonshlp beLween
Lhe company and dlrecLors
(b)IRECTORS AS EPLOEES:
The directors of a company are agents, they are not employees or servants of the
company for being entitled to privileges and benefits which are granted under the
companies act to the employees. But there is noting to prevent a director from being a
servant of the company under a special contract of service which he may enter into the
company.
The companies act itself indicates many situations where a director may be in the
employment of a company.
(a)IRECTORS AS OFFICERS:
For certain matters under the companies act, the directors are treated as officers
of the company.
(b)IRECTORS AS TR&STEES:
Directors are treated as trustees-
(i)of the company`s money and property and
(ii) of the powers entrusted to them.
RESTRICTIONS ON APPOINTENT OF IRECTORS
(sec 266)
A person shall not be capable of being appointed director of a company by
the articles and shall also not be named as a director or proposed director
in the prospectus unless before the registration of the articles or the
publication of the prospectus or the filling of the statement in lieu of
prospectus.
NC CI DIkLC1CkSnIS
-o person Lo be a dlrecLor of more Lhan 20 companles
ISQ&ALIFICATIONS OF IRECTORS (sec 27)
The foIIowing persons are disquaIified :
(a)a person of unsound minded.
(b)an undischarged insolvent.
(c )a person who has applied to be adjudicated as an insolvent and his
application is pending.
(d) a person whose calls in respect of shares of the company held for
more than 6 months ,have been in arrear.