Removal of Director — The Section 169 Process for Removing a Company Director.

The removal of a director before the expiry of their term of office is governed by Section 169 of the Companies Act, 2013. Unlike a resignation — where the director initiates the exit by submitting a written resignation — a removal is initiated by the shareholders and requires a specific procedure that gives the director being removed the right to be heard. The procedure cannot be bypassed; a director cannot be removed simply by a board resolution or a casual decision at a board meeting. The statutory process must be followed precisely, and DIR-12 can only be filed after the removal resolution is passed.

The Section 169 procedure begins with a special notice — a notice received from shareholders holding at least one-tenth of the total voting power (or 100 members, whichever is lower) to the company, proposing the removal of the director at a general meeting. The company must then send a copy of the special notice to the director proposed to be removed, who has the right to make written representations and to be heard at the meeting. The company must hold a General Meeting at which the removal is passed by an ordinary resolution — a simple majority of shareholders voting in favour.

Certain categories of directors cannot be removed under Section 169: directors appointed by the Tribunal under certain provisions; directors appointed by the Central Government in certain companies; and (to a limited extent) directors whose appointment is protected by the Articles. Additionally, independent directors can only be removed by a special resolution (not an ordinary resolution). Once the removal resolution is passed, DIR-12 must be filed within 30 days. Where the director has submitted a resignation alongside or instead of a formal removal, DIR-11 (by the director) and DIR-12 (by the company) are both required.