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How to Start Add or Remove a Director (Company)



Directors are the mind behind the setup of a company or we can say they are the brain of the company. They are the person who manage, control and administer the operations of the company. The rotation of the directors takes place in one or the various ways- either by the appointment of new director or resignation of the existing one. Aim to carry out change of directors is always to ensure optimum combination of experts on board for the company’s interest. The authority to appoint a director must be made through consent of shareholders whereas the authority to approve the resignation of the director lies with the members of BoD. Whether it is an appointment, resignation or removal, the intimation is made to Ministry of Corporate affairs for the change to come in effect.

Why Change in Directors is Required?

  • On board hiring a new talent: with the emergence of growth of business, strategies and alliances are developed, it basically requires inputs or contribution of each department for effective planning. Also, with the addition of new product line or department, an expert to lead the team can be hired in a managerial position being the director of the company. This benefits the company with focused efforts and specialization.

  • Inability to work by existing directors: The present director may not be able to serve the company after a certain period due to retirement or other personal reasons. Whether it is his death or resignation by the director, the company must needs to make sure that the work is unaffected. It needs to process for both appointment of a new director if any or discontinuations.

  • Without dilution ownership assign operational responsibility: for day to day operations Directors are responsible. With the appointment of an additional director, the shareholder can assign the responsibilities related to operations to director for keeping strategic control in hand. Here, a director does not requires to subscribing to share capital, hence, voting rights and ownerships of shareholders does not dilute with a new person on board.

  • Number of director’s fall under statutory limit: the minimum number of directors in the company has been described by The Companies Act, which is 2 and 3 for Private and Public company respectively. At any time during the existence of the company, the number of directors shall not reduce below the limit. The company must appoint a new director(s) within 6 months if there is reduction in the number below 2/3.

What Are the Mandatory Documents Required for Addition or Removal of Director?

  • Digital Signature Certificate

  • PAN Card

  • Photograph

  • Proof of residence

What Is the Minimum Number of Directors?

Number of directors

Frequently Asked Questions (FAQs)

There is no as such requirement to subscribe the shares by the director. If the Articles (AoA) of the company prescribe for any such subscription, it must be fulfilled as a condition for his appointment.

If the total number of director is less than the prescribed number, the company must direct a director(s) in the company to fulfill the requirement within 6 month for resignation/removal/death of the concerned director.

Yes, a director can resign voluntarily/himself. The notice of resignation must be served to company stating reason of resignation. The resigning director must need to file.

No, if you already have DIN you don’t required to obtain another DIN. It is allotted permanently and can be used for a person’s subsequent appointment in any company/LLP.

For the removal of the director from the company, the directors shall conduct a meeting of members for their consent after serving special notice in this regard. The present director must be given an opportunity to represent his grounds.

Once the director has filed his resignation with the MCA and the company, now it is the responsibility of the company to intimate the change to MCA. Within 30 days from the resignation the requisite e-form is required to be filed. Further, the vacancy of the director is required to be filled as per the requirement.

No, even after the end of the tenure as a director, a person can still holds the share in the company. However, if the shares are subscribed in the company as a condition provided by AoA, the shares are also required to be disposed of in the manner provided in AoA.

By executing the Share Transfer deed the shares of the company shall be transferred and also be affixing the stamps as per the rates mentioned in the Stamp Act of the concerned State after the change.

Only an individual can act as a director in the company. Hence, if any LLP or Company is interested to be added as a director in the company, only its representative may act as the director.

Yes, an NRI or Foreign National can be a Director of a Private Limited Company after obtaining Director Identification Number. At least, one on board director must be resident of Indian any time after incorporation of company.

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