A Procedure To Become A Director In A Private Limited Company

A director is a person appointed to manage and supervise the affairs of a company and while a business may start with two individuals taking up the responsibility but as the organization grows, it becomes necessary to bring in more professionals who can look after the different facets of the expanding operations. Here some light will be shed on the procedure to become a director in accordance with the Companies Act,2013.

 

Digital Signature Certificate (DSC) Application

The whole procedure is online and therefore it becomes mandatory to have a DSC for signing the virtual documents. The application can be made to the Certifying Authority, details of which can be obtained from Ministry of Corporate Affairs (MCA). 

 

Director Identification Number (DIN) Application

The e-form DIR-3 has to be filled and submitted to the MCA for obtaining the DIN by a person intending to become the director in a company.

 

Documents Required For DSC & DIN

• PAN Card (Self- attested copy)
• Address Proof (Passport/ Driving License/ Voter ID or Utility Bill like Electricity/ Telephone/ Water/ Piped Gas)
• Photograph

 

Consent

The procedure to become a director requires the person intending to do so to furnish a written acquiescence by filling Form DIR-2.

 

Form DIR-8  

This document is needed to be filled by the person in order to declare that he/she is not disqualified under Section 164(2) of the Companies Act. It is important for the management of an organization thinking of adding a director to the limited company to ensure that the individual in question is of sound mental faculties, solvent, never been convicted by a court of law apart from fulfilling a few other conditions stipulated in Section 164.

 

Board Meeting

A board meeting needs to be called with the agenda of appointment of the new director listed clearly in the notice. The resolution to make the addition to the list of directors should be presented and if passed a letter confirming the appointment should be issued to the candidate. All the minutes of the meeting must be recorded. 

 

Form DIR-12

The e-form DIR-12 needs to submitted to the Registrar of Companies (RoC) along with DIR-2, DIR-8, letter of appointment and a certified copy of the resolution passed at the board meeting. It must be noted here that the process of filling this form has to be undertaken within 30 days of the appointment of the new director. The RoC on finding the application satisfying all conditions may direct the addition of the new member to be displayed in the company’s section on the MCA website.

 

Conclusion

The procedure to become a director may seem lengthy but it is important to do so for the smooth functioning and secure future of the organization.The fortunes of all the employees are linked to the prosperity of the enterprise and therefore each and every process and action associated with its functioning has been developed with checks and balances. It is the duty of the people entrusted with the task of running such corporations to follow due diligence and observe every rule while conducting day to day operations.