Section 168: Resignation of director
This section is for outlining the procedure and effects of a director's resignation from a company.
The section, clause by clause
What the section says
In plain terms
(1)A director may resign from his office by giving a notice in writing to the company and the Board shall on receipt of such notice take note of the same and the company shall intimate the Registrar in such manner, within such time and in such form as may be prescribed and shall also place the fact of such resignation in the report of directors laid in the immediately following general meeting by the company:
A director can resign by giving written notice to the company, and the company must inform the Registrar and include the resignation in the next general meeting's director report, and the director can also send a copy of their resignation and reasons to the Registrar within 30 days.
provisoProvided that a 3[director may also forward] a copy of his resignation along with detailed reasons for the resignation to the Registrar within thirty days of resignation in such manner as may be prescribed.
(2)The resignation of a director shall take effect from the date on which the notice is received by the company or the date, if any, specified by the director in the notice, whichever is later:
A director's resignation takes effect from the date the company receives the notice or a later date specified by the director, and the director remains liable for offences that occurred during their tenure.
provisoProvided that the director who has resigned shall be liable even after his resignation for the offences which occurred during his tenure.
(3)Where all the directors of a company resign from their offices, or vacate their offices under section 167, the promoter or, in his absence, the Central Government shall appoint the required number of directors who shall hold office till the directors are appointed by the company in general meeting.
If all directors resign, the promoter or Central Government must appoint new directors to hold office until the company appoints new ones in a general meeting.
The right-hand column is written from the section text, not quoted from it, and it has no legal force. Where the two differ, the left-hand column is the law.
Amendment notes
- 1. The words “with imprisonment for a term which may extend to one year or” omitted by Act 29 of 2020, s. 34 (w.e.f. 21-12- 2020).
- 2. Subs. by s. 34, ibid., for “five lakh rupees, or with both” (w.e.f. 21-12-2020).
- 3. Subs. by Act 1 of 2018, s. 55, for “director shall also forward” (w.e.f. 7-5-2018).
- 4. The proviso ins. by Notification No. S.O. 768(E), dated 21st February, 2018 (w.e.f. 21-2-2018).
- 5. Subs. by ibid., for “Provided that”(w.e.f. 21-2-2018).
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Reproduced from the official India Code print for reference. Check the current text on India Code before you rely on it, and read the section alongside its Rules. Nothing here is legal advice.