Comment on the following statements: Directors can be removed only by passing a special resolution.

CS Executive · Company Law · PYQS · June 2019
Comment on the following statements: Directors can be removed only by passing a special resolution.

Answer & Explanation:

According to Section 169 of the Companies Act, 2013 a company may, by ordinary resolution, remove a director, not being a director appointed by the Tribunal under section 242, before the expiry of the period of his office after giving him a reasonable opportunity of being heard. The provision relating to removal shall not apply where the company has availed itself of the option to appoint not less than two-thirds of the total number of directors according to the principle of proportional representation. The company has to follow the prescribed procedure in section 169 of the Companies Act, 2013 for the removal of director. A special notice is required of any resolution, to remove a director under Section 169. Further the director concerned shall be entitled to be heard on the resolution at the meeting. Proviso to section 169(1) of the Companies Act, 2013 provides that an independent director re-appointed for second term under section 149(10) shall be removed by the company only by passing a special resolution and after giving him a reasonable opportunity of being heard. Hence the statement that 'Directors can be removed only by passing a special resolution is not correct.

Topics: Directors

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