WHY A RESIGNING DIRECTOR FILE FORM DIR-11 WITH MCA?

WHY A RESIGNING DIRECTOR FILE FORM DIR-11

 WITH MCA?

·      Where there are management disputes, in such companies, the directors still have an option to file DIR 11 mainly to safeguard their interests.

·      Where the company has not taken any action even after the receipt of the director’s resignation, filing form Dir-11 will save the director any future actions taken against him for the misfeasance of the board of the company.

·      In case of insolvent companies , if form Dir-11 is not filed by a director , such directors personal assets may be attached under IBC 2016.

eForm DIR-11 has been introduced in the Companies Act, 2013

Director may resign from his office by giving a notice in writing to the company and he is also required to forward a copy of his resignation along with detailed reasons for the resignation to the Registrar within thirty days of resignation in eForm DIR-11.

 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.

eForm DIR-11 is required to be filed pursuant to Section 168 (1) of the Companies Act, 2013 and Rule 16 of Companies (Appointment and Qualification of Directors) Rules, 2014 which are reproduced for your reference.

Section 168(1) of the Companies Act 2013

 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: Provided that a director shall 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.

Rule 16:

 Where a director resigns from his office, he shall within a period of thirty days from the date of resignation, forward to the Registrar a copy of his resignation along with reasons for the resignation in Form DIR-11 along with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014.

e-Form DIR-11:

1) Where a director resigns from his office, he shall within a period of thirty days from the date of resignation, forward to the Registrar a copy of his resignation along with reasons for the resignation in Form DIR-11along with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014.

2) The Reasons should be clearly mentioned in the form for the resignation by the Director.

3) The form shall be digitally signed by the director itself who has resigned from the office.

4) The resignation shall take place from the date on which notice of Resignation is received by the Company or any other Date specified by the Director in the notice whichever is later.

5) The Effective Date of resignation {Field 4(B)} shall be the date as entered by the Company in e-Form DIR-12 for cessation of the Director.

6) Following Scanned Documents are mandatory and shall be attached along with form:

a. Notice of Resignation filed with the Company

b. Proof of Dispatch

c. Acknowledgement received from Company If any (Mandatory only if yes selected at serial no.6 in the form )

Status of Director Resigned will be Changed to “ Resigned” after approval of DIR-11.

DIRECTOR’S IS STILL LIABLE

It is to be noted that the concerned director shall be held liable even after his resignation for the offences committed during his tenure as a director in the company.

CHANGE IN THE STATUS OF THE DIRECTOR AFTER FILING DIR-11

When a director files eForm DIR-11 for intimating about his resignation before the company files eForm DIR-12, an email will be sent to the company for filing the eForm DIR-12 and the status of the Director in the company will be changed to ‘Resigned’ against the selected designation. Once the company files the relevant eForm DIR-12, the status shall be changed as per the existing system

If Directors are not advised not to file Dir-11

 If a director has resigned since 2015 but was not advised to file Dir 11. Can we still file now and specify effective resignation as 2015 given that it has exceeded 270/300 days? What are the possible penalties?

Yes, one can still file DIR-11. 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. [Section 168(2)]. At the moment, DIR-11 is not getting blocked for delay beyond 270 days.