• Others
• ||
• August 5, 2026

Company shareholders, promoters and board members may sometimes need to remove a director before the end of their term due to misconduct, poor performance, conflict of interest, loss of confidence or management disputes. Directors facing removal may also need to understand their legal rights and the process the company must follow.

Removing a director is a sensitive legal matter. If the company does not issue the correct notice, provide the director with an opportunity to be heard, pass the required resolution or complete the necessary ROC filing, the removal may be challenged. Companies must also understand that removal, resignation and automatic vacation of office are different situations and follow separate legal procedures.

The Companies Act, 2013 provides a clear process for removing a director. The procedure is mainly governed by Section 169, read with Section 115 and Rule 23 of the Companies (Management and Administration) Rules, 2014. This blog explains the grounds for removal, the rights of the concerned director, the step-by-step procedure and the compliance filings required to complete the process correctly.

Who can remove a director from a company in India?

Under companies act 2013, the power to remove a director rests with the shareholders, not the board. Directors are answerable to the members who appointed them, so it is the members — in a general meeting — who can remove a director before their term ends. The board’s role is limited to convening the meeting and issuing the notices.

A company may remove a director by an ordinary resolution, after giving the director a reasonable opportunity of being heard. Two exceptions apply:

• An independent director re-appointed for a second term can be removed only by a special resolution, again after a reasonable opportunity of being heard.
• A director appointed by the National Company Law Tribunal under Section 242 (in a case of oppression and mismanagement) cannot be removed by the company under this section.

The procedure also does not apply where the company has chosen, under Section 163, to appoint at least two-thirds of its directors by the principle of proportional representation.

Removal, Resignation and Vacation of Office are not the Same

These three get confused often, and picking the wrong one is a common mistake.

Section 169 is about removal by shareholders. It gives the owners of the company the power to remove a director before their term ends — even if the director does not want to go, and even if the board disagrees. It is the shareholders’ safeguard: the people who own the company get the final say on who runs it. Because it is a serious step, the law does not let it happen quietly. The shareholders must call a general meeting and pass an ordinary resolution, meaning more than half the votes must support it. The director must be told in advance, given a chance to speak at the meeting, and allowed to send a written reply to the members. Only one exception applies — a director appointed by the Tribunal cannot be removed this way. The full procedure is set out below.

The other two routes are entirely different:

• Resignation (Section 168) — the director chooses to leave. They simply give written notice to the company. The board records it and files the forms. Shareholders are not involved and there is no vote.
• Vacation of office (Section 167) — the seat empties on its own. If a director becomes disqualified under Section 164, or misses every board meeting for twelve months, they stop being a director automatically. Nobody has to pass a resolution; the company just files a form to record what has already happened.

Which one applies? If the director is disqualified or has stopped turning up, the company normally relies on Section 167 — it is quicker and needs no meeting. Section 169 is for the harder case: the director is willing to stay on, but the shareholders want them out.

Grounds for Removal of Director Under Companies Act 2013

Before the procedure, one question comes up almost every time: does the company need a valid reason to remove a director?

Shareholders do not need to prove misconduct to remove a director; the ordinary resolution route is available as a matter of right. In practice, removal is proposed for reasons such as a loss of confidence, a conflict of interest, non-performance, a breach of duty, continued absence, or a change in the company’s ownership or strategic direction. What matters is that the correct procedure is followed and the director is given a fair chance to be heard.

Procedure for Removal of a Director Under Section 169

Removal follows a fixed sequence, and each step exists to protect someone’s rights. Here is how it runs, from the first notice to the final filing.

Step 1 — Special notice from members. The process begins with a special notice under Section 115, signed by members holding at least 1% of the total voting power, or holding shares on which at least Rs. 5,00,000 has been paid up as on the date of the notice. The notice must reach the company at least 14 clear days before the meeting (and not earlier than three months before it).

Step 2 — Company informs the director. On receiving the special notice, the company must immediately send a copy to the director concerned. The director is entitled to be heard on the resolution at the meeting.

Step 3 — Director’s right of representation. The director may make a written representation to the company and ask for it to be circulated to members. If time permits, the company must send the representation to members; if it arrives too late, the director may require it to be read out at the meeting. The Tribunal may dispense with circulation if it is satisfied the right is being abused to secure needless publicity for defamatory matter.

Step 4 — Notice of the general meeting. The company issues notice of the general meeting to all members, giving at least 21 clear days (a shorter period is allowed only with the consent of members as prescribed).

Step 5 — Pass the resolution. At the meeting, the members vote. An ordinary resolution (a simple majority) is enough to remove an ordinary director; a special resolution is required to remove an independent director in their second term.

Step 6 — File with the Registrar. The company files Form DIR-12 with the Registrar of Companies within 30 days of the resolution, along with the certified resolution and supporting documents, to record the change.

What happens to the vacant seat of the director?

The company may appoint a new director in place of the removed director at the same meeting, provided that special notice of the proposed appointment has been given. A director appointed this way holds office only until the date the removed director would have served, had they not been removed.

If no appointment is made at the meeting, the resulting vacancy may be filled as a casual vacancy in the usual way. Importantly, the removed director cannot be re-appointed by the Board.

Compliance and Penalties After Removal of Directors in India

Form DIR-12 must be filed within 30 days of the resolution. Late filing attracts additional fees that rise with the length of the delay — from twice the normal fee for short delays up to as much as twelve times the fee for delays beyond 180 days — and continued default can invite further action. For listed companies, the removal of an independent director additionally requires approval by a special resolution under SEBI’s LODR framework.

Need Help Removing a Director the Right Way?

At Mercurius, we have handled director appointments and removals across companies of every size, so the process holds no surprises for us. We identify the correct route — a Section 169 removal, a Section 168 resignation, or a Section 167 vacation of office — and then handle it end-to-end, from the special notice through to filing Form DIR-12 by the deadline, along with the registers and minutes that follow.

Contact us to discuss the removal or appointment of a director for your company.

Phone: +91 966 777 9615

Email: info@masllp.com