Vacation of Office of Director

Vacation of office of Director means when the director ceases to hold the office on various grounds. So let’s look on the ground of vacation of office of Director of are as follows:

  • The vacation of the director attracts when he incurs any of the Disqualification mentioned in the Companies Act. 
  • If the director is absent from all the meetings of the Board of Directors, which is held during a period of 12 months. Whether the director is absent with or without seeking leave of absence of the board.
  • When a Director acts in a contravention relating to entering into contracts or arrangements in which he is directly or indirectly interested.
  • If the Director fails to disclose his interest in any contracts or arrangements in which he is directly or indirectly interested in the contravention of the provision of Companies Act.
  • If an order is passed by the court or by the tribunal and he becomes disqualified then he has to vacate his office.
  • When the Director is convicted by a court of any offense whether involving moral turpitude (immorality) or otherwise and sentenced in respect thereof to imprisonment for not less than 6 months. But the office of director shall not be vacated in case an order is passed by the court or by the tribunal and he becomes disqualify then he has to vacate his office or the Director is convicted by a court of any offense whether involving moral turpitude (immorality) or otherwise and sentenced in respect thereof to imprisonment for not less than 6 months.
    •  The office is not vacated from 30 days from the date of conviction or order of disqualification, 
    • Where an appeal or petition is filed within 30 days against the conviction resulting in sentence or order until expiry of 7 days from the date on which such appeal or petition is disposed of.
    • Where any further appeal or petition is done against order or sentence within 7 days until such further appeal or petition is disposed of.
  • If the removal of the director is done then his office is vacated.
  • If he has been appointed a director by reason of his holding any office or other employment in the holding, subsidiary or associate company ceases to hold the office or other employment in that company.

A private company may by its articles provide any other ground for the vacation of the office of a director in addition to above-given grounds.

When the office of all the directors is vacated:

Where all the directors of a company vacate their offices under any of the disqualifications then the promoter or in the absence of promoter Central Government shall appoint the required number of directors (depend upon the type of company Private, Public, or an OPC) who shall hold the office till the directors are appointed by the company in the general meeting.

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