Qualifications & Disqualification of The Director


Who is Company Director?

Director refers to a person who is responsible for supervision and control the whole affairs of the company and performs various functions that are necessary for attaining the company’s goals. They are considered as trustees of the company and are responsible and liable for any action on behalf of the company.

They are termed as the intermediary of all the transactions which are done by them for the company. These are basically elected or appointed members of the board of directors who are having the core responsibility of carrying out all the processes in the way so that the company’s motives can be achieved.

They are registered as the director of the limited company at the company house clearly defining their roles and responsibilities. For a director, it is not necessary that they are holding the shares of the company or working employee of the company and can also work as an only the director of the company.

They generally act on the various resolutions which are taken in the meetings of the directors and get their power to act from the company’s article of association. They are required to perform their task and obligations that are on them as the rationally with the required knowledge, skills and required experience.

Qualifications of The Director

As far as the directors’ qualifications are concerned, no direct norms or provisions are given in the companies act 2013. But as per the provisions relating to directors are concerned, the following conditions are required to fulfil:

  • The person acting as a director should be able to behave rationally and be of sound mind.
  • If the article of association of company provides for holding the shares qualification in the company, then he should hold that.
  • Being an individual is also a must qualification for being a director.
  • A person acting as a director should be a solvent one.
  • The one acting as a director should not be convicted by the court for an offense.

Number of The Directors Required in Company

According to section 149 of companies act 2013, the following important requirements should be fulfilled as per the type of company.

Public company

For a public limited company there must be at least or the minimum of 3 directors and a maximum of 15 and for additional, a special resolution is passed.

Private company

For a private limited company there must be a minimum of 2 directors and a maximum of 15 directors and for additional, a special resolution is passed.

One person company

For one person company there must be at least or a minimum of 1 director and a maximum of 1 and for additional, a special resolution is passed.

Producer company

For a producer company there must be at least 5 directors and for a maximum number the condition is same as above said.

Disqualification of Companies Director

  • A director can be disqualified as per section 164 of companies act 2013 for the following mentioned reasons:
  • If the person acting as the director is found to be of unsound mind and is even declared so by the concerned court.
  • He is found to be an undischarged insolvent. Director’s application for adjudicated as insolvent is pending.
  • If any court has convicted the person of any offense which involves immoral behavior and has been imprisoned for at least six months.
  • If any court or tribunal has passed an order which disqualifies him to be appointed as a director.
  • If the person has not done payment of calls for shares which he holds and 6 months have passed from last day fixed for the payment. Director identification number is not acquired by him.
  • New DIR-3 KYC form has not been filed by him.

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