Can directors be removed if they have shares in the company

My Question is that I have a Pvt. Company and we are 4 Directors and all Directors are my family members e.g. My Parents and Brother. I want to remove my parents from directorship. They own shares in company. I want that they can keep shares even after removal of Directorship.

Answers (1)

300 votes

According to Companies Act, 2013, a director is a person who is in charge of the affairs of a company. It can be related to anything and everything. A director is appointed through the voting procedure by the shareholders of the company. Therefore, a shareholder may not be necessarily a director in a Pvt. Limited Company.
In my opinion you can remove your parents from directorship in accordance with Section 284 of the Companies Act, 2013 and they still can own as many numbers of shares in your company. Please note that as per law a Pvt. Limited Company should have minimum 2 directors.

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