Every public company ( other than a deemed public company ) must have at least three directors. Every other company must have at least two directors.
The directors of a company collectively are referred to as the “Board of directors” or “Board”. Only individuals can be appointed as directors. No body corporate, association or firm can be appointed director of a Company.
In case the first directors are not appointed by the promoters of a company, subscribers of the memorandum who are individuals, shall be deemed to be the directors of the company, until the directors are duly appointed.
Appointment of directors and proportion of those who are to be retire by rotation
Unless that articles provide for the retirement of all directors at every annual general meeting, at least two-thirds of the total number of directors of a public company, or of a private company which is subsidiary of a public company, must :-
(a) retire by rotation
(b) be appointed by the company in general meeting, except where otherwise provided by the Companies Act.
The remaining directors in the case of any such company, and the directors generally in the case of a private company which is not a subsidiary of a public company, must also be appointed by the company in general meeting, unless otherwise provided in any regulations in the articles of the company.
Ascertainment of directors retiring by rotation and filling of vacancies
At every annual general meeting of a public company, or a private company which is a subsidiary of a public company, one-third of the directors liable to retirement by rotation or if their number is not three or a multiple of three, then, the number nearest to one-third, shall retire from office.
The directors to retire by rotation at every annual general meeting shall be those who have been longest in office since their last appointment, but as between persons who became directors on the same day, those who will have to retire is to be determined by lot, unless otherwise agreed to among themselves.
At the annual general meeting at which a director retires as aforesaid the company may fill up the vacancy by appointing the retiring director or some other person thereto. In other words, a retiring director is eligible for re-appointment at the same meeting.
If the place of the retiring director is not so filled up and the meeting has not expressly resolved not to fill the vacancy, the meeting shall stand adjourned till the same day in the next week, at the same time and place, or if that day is a public holiday, till the next succeeding day which is not a public holiday, at the same time and place.
If at the adjourned meeting also, the place of the retiring director is not filled up and that meeting also has not expressly resolved not to fill the vacancy the retiring director shall be deemed to have been re-appointed at the adjourned meeting, unless
a resolution for the re-appointment of such director has been put to the meeting and lost
the retiring director, has by a notice in writing addressed to the company or its Board of directors, expressed his unwillingness to be so re-appointed
he is not qualified or is disqualified for appointment
a resolution, whether special or ordinary, is required for his appointment or re-appointment in virtue of any provisions of this Act.
Right of persons other than retiring directors to stand for directorship
A person who is not a retiring director shall, subject to the provisions of this Act, be eligible for appointment to the office of director at any general meeting, if he or some member intending to propose him has, given notice in writing to the company at its registered office of at least 14 days before the meeting, signifying his candidature for the office of director or the intention of such member to propose him as a candidate for that office along with a deposit of rupees five hundred ( refundable on successful election ).
The company must inform its members of such candidature by giving at least 7 days prior notice. Such notice may not be required if the company advertises such candidature at least 7 days before the meeting in at least 2 newspapers circulating in the place where the registered office of the company is situated, one of which must be in English and the other in the regional language.
This provision shall not apply to a private company, unless it is a subsidiary of a public company.