Meaning of Director 

Companies Act, 2013 defines the term “Director” as a person appointed to the Board of a company. The Board of Directors is a group of individuals elected by the company shareholders to manage the company affairs. 

Director is someone who administers, supervises, controls, or directs company policies and affairs.

Appointment of Director in Private Limited Company

Appointment of Directors is often necessary for a company based on the requirements of the shareholders of the business.

To appoint a director, the person proposing to become a Director must receive a digital signature certificate (DSC) and director identification number (DIN). A person above the age of 18 years can procure the DIN. The nationality or residency status of the DIN applicant is irrelevant. Hence, Indian Nationals, NRIs, and Foreign Nationals can obtain DIN and become directors of an Indian company.

Obtain Consent of Proposed Director

Proposed Director must give his consent to act as Director in the Company as per Form DIR-2. A company must obtain Form DIR-2 before selecting him as the Director of a company. 

Digital Signature of Proposed Director

If the proposed Director does not have Digital Signature, he must obtain Digital Signature from the Certifying Authority in India.

Obtain Director Identification Number (DIN) 

If the proposed Director of a company does not have DIN, he should let the company know that he does possess it. Then the company, in which such appointment of Director takes place, must pass a Board Resolution for proposing him to be appointed as a Director of the Company. A company should apply for the DIN of the proposed person. It is necessary to attach a copy of the Resolution with Form DIR 3. (This is a new requirement for obtaining DIN, as a new person cannot just apply for DIN if he is not to be appointed as Director in any Company). DIN is only allotted once for the lifetime of the Director.  

A company should obtain all KYC documents and the necessary educational Qualification documents required as per the terms of the job. There is no minimum education qualification required to hold the position of Director in an Indian Company. 

Issue of Notice of General Meeting

The appointment of a Director in a Company is through the General Meeting. A company should issue a notice to all the company shareholders for holding an Extraordinary General Meeting of the Company. The Notice of General Meeting should be issued as per provisions of Companies Act, 2013 and rules made thereunder and Secretarial Standards issued by Institute of Company Secretaries of India (ICSI).

Hold Extraordinary General Meeting of the Company 

Once the Notice of EGM is circulated to the shareholders, the company should hold the meeting and Pass the Necessary Resolution for Appointment of Director as Company. 

Issue Letter of Appointment 

Issue Letter of appointment to the Director of the Company, mentioning the terms and conditions of such appointment and salary to be payable to the Director.

File Form DIR-12 to ROC

Once all the above steps are complied with, a company should file Form DIR-12 to ROC within 30 days from the appointment date. It is prudent to file the Form DIR-12 within the next day of such an appointment to avoid late filing and Additional Fee.

Making Necessary Entries in Register of Directors 

A company should make necessary entries in the Register of Director and Key Managerial Personnel.

File Necessary Changes 

A company must make the necessary changes in the Director's details, in GSTN and Other Certificates, wherever applicable. 

This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.