The Companies Act, 2013, in India, says what a director’s rights are when he or she is fired with special warning. The Act spells out the steps and rules for removing a director from a company’s board, including those about special notice.
Section 169 of the Companies Act says that any director can be fired by a simple vote of the owners at a general meeting. But if a director is removed by giving them special warning, they have some extra rights and rules.
Special Notice: A director who is replaced by special notice has the first and most important right to get a written special notice. At least 14 days before the general meeting, the company must give notice that it plans to move a motion to get rid of the director.
Chance to be Heard: The director who is being fired has the right to be heard at the general meeting where the decision to fire them is being made. They can make their point, explain it, and defend themselves against any accusations made.
Access to the Shareholder Register: Before the general meeting, the director has the right to look at the company’s list of shareholders. This lets the board check to see if the notice was sent by a real member or shareholder of the company.
- Communication with the Registrar of Companies: If the director wants to fight their removal, they can send a letter to the Registrar of Companies within 30 days of getting the news of their removal. The director should say what happened and why they are fighting their removal in the letter of representation.
- Right to legal remedies: If the director thinks that they were fired in an unfair or illegal way, they can sue the company. This could mean going to the National Company Law Tribunal (NCLT) with a petition to question the decision to get rid of them.
It’s important to remember that these rights and rules are meant to protect the interests of the director who is being fired and make sure that the process is fair. But it’s always a good idea for directors to talk to lawyers to find out what their rights and choices are in these kinds of situations.