quesIf i resign as director of company will i have share in the assets?

I am a director in a company and i have made my mind to resign from the company. The company has assets worth 96 lakh and liabilities worth 70 lakh. I wanted to know if i resign from the company and pay my liabilities, will i have share in the assets or not?

  • ansYou can immediately resign. Unless the Articles of Articles of the company concerned contain any specific provision about acceptance of resignation by the Board of Directors of the company, the resignation from directorship takes effect immediately, i.e., from the date of the resignation letter. 

    You do not have to pay towards the Companies' liability (unless it is a Criminal/ Fraud Liability against you) nor can you claim in the assets of the Company.

    The Companies Act restricts the ability of a company to indemnify its Directors and officers against losses. The Companies Act, however, does not prevent a company from taking an insurance policy for its own protection against loss caused to it by its Directors. Further, the Director can take out a policy to recompensate the loss he suffers because of his liability to the company. The premium for such policy may be paid by the company itself.

     

  • ansYou are not entitled to assets by virtue of being a "Director." That right is only with a "shareholder." Often shareholders nominate themselves on the Board as Directors'. You will have to share your company's name as well as information on how much capital you had subscribed to for any lawyer to evaluate your rights. I recommend meeting a lawyer face-to-face.

    Advocate Dhruv Suri

      Barakhamba Road, Delhi

  • ansYou can immediately resign. Unless the Articles of Articles of the company concerned contain any specific provision about acceptance of resignation by the Board of Directors of the company, the resignation from directorship takes effect immediately, i.e., from the date of the resignation letter.

    You do not have to pay towards the Companies' liability (unless it is a Criminal/ Fraud Liability against you) nor can you claim in the assets of the Company.

    The Companies Act restricts the ability of a company to indemnify its Directors and officers against losses. The Companies Act, however, does not prevent a company from taking an insurance policy for its own protection against loss caused to it by its Directors. Further, the Director can take out a policy to recompensate the loss he suffers because of his liability to the company. The premium for such policy may be paid by the company itself.

    Advocate Ashima Puri

      Saket District Court, Delhi

  • Disclaimer: The above query and its response is NOT a legal opinion in any way whatsoever as this is based on the information shared by the person posting the query at LawRato.com and has been responded by one of the Corporate Lawyers at LawRato.com to address the specific facts and details. You may post your specific query based on your facts and details to get a response from one of the Lawyers at LawRato.com or book a Detailed Consultation with a Lawyer of your choice to address your query in detail.
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