Section 161 of Companies Act 2013- Appointment of Additional Director
- Applicability : Applicable to all Companies (Private/ Public).
- General Concept : Although Directors are appointed by the shareholders at General Meeting only but if Company wants to appoint any Director in their Board and that too without calling General Meeting then they can do the same with the help of Section 161 of Companies Act 2013 because Section 161 authorize its Board to appoint **any person as its Additional Director.
- Conditions for Appointment : Articles of Association of Company must authorize the Board that Directors can appoint **any person as an Additional Director.
**Any person should be other than a person who fails to get appointed as Director in GM.
- Tenure : From the date of Board Meeting in which he has been appointed till the date of next Annual General Meeting (AGM) only.
Q1. What if Company doesn’t hold AGM then what would be the tenure???
Ans1. In this case, tenure of Additional Director would be upto the last date on which AGM should have been held.
Procedure for the appointment of Additional Director
- Check whether Articles of Company gives power to its Board of Directors for the appointment of Additional Director.
- Check whether the person who has been proposed as Director have DIN (Director Identification Number).
- Obtain the written consent from Director in Form DIR-2.
- Convene the Board Meeting for consider and approving the appointment of Additional Director.
- Intimate to stock exchange within 30 minutes of conclusion of its Board meeting regarding such appointment.
- File form DIR-12 with ROC (Registrar of Companies) within 30 days from the appointment of additional Director.
**Imp Note: Tenure of Additional Director is only upto the next AGM, so if, Company wants to continue its additional Director in the Company even after the next AGM then Company can do so by regularize the Additional Director as Director of the Company.