Overview of Appointment and Resignation of Director

Directors do indeed play a vital role in the functioning and governance of a company. Here's a breakdown of the points:

1. Directors as the Working Brain: Directors are indeed integral to a company's functioning. They are responsible for managing, controlling, and overseeing the company's operations, strategies, and services. They provide leadership and make critical decisions that shape the company's direction.

2. Rotation of Directors: The term "rotation" can refer to different concepts in the context of a company. In the context you've described, it seems like you are referring to the process of appointing new directors or the withdrawal/resignation of existing directors. This process is important to ensure a diverse mix of skills and expertise on the board.

3. Optimum Blend of Experts and Shareholders: The objective of changing directors is often to maintain a balanced and diverse composition of the board. This ensures that the board has a combination of industry experts, professionals, and representatives of shareholders, all contributing to the company's growth and success.

4. Approval of Resignation and Appointment: Resignations of directors are typically approved by the Board of Directors, while the appointment of directors can involve the approval of shareholders, depending on the company's governance structure and legal requirements.

5. Intimation to MCA: In many jurisdictions, changes in the board composition, such as appointments, resignations, and removals of directors, need to be officially communicated to the relevant regulatory authority. This is to maintain transparency and ensure compliance with corporate governance standards.

Who is the Director of the Company?

1. Director Definition: The Companies Act 2013 doesn't provide an exhaustive definition of a director. Directors are essential individuals appointed to execute their roles according to the provisions of the Act. The definition of a director is associated with working within the Board of Directors.

2. Board of Directors: The Board of Directors collectively constitutes the governing body of a company. It supervises management activities and safeguards the long-term interests of stakeholders.

3. Eligibility Criteria:

   • Natural Person: Only specific natural persons can become directors of a company.
   • Nationality: While there's no nationality confinement, at least one Indian director is mandatory.
   • Age: No fixed age for directorship, but individuals should be legally competent to enter into contracts. Specific age criteria apply for roles like managing directors, independent directors, or full-time directors.
   • Limit of Directorship: An individual can be a director of up to 20 companies concurrently, with a maximum of 10 public limited companies.

4. Director Identification Number (DIN): Obtaining a DIN is essential for becoming a company director. It serves to prevent fraudulent activities and allows for background checks, such as criminal records.

5. Ineligibility Criteria:

   • Unsound Mind or Bankruptcy: Individuals of unsound mind, mentally disabled individuals, and those declared bankrupt are ineligible to become directors.
   • Criminal Background: Individuals with criminal records or who have been imprisoned for more than seven years are ineligible.
   • Pending Overdue Returns: If an individual has outstanding overdue returns, they cannot become directors.

6. Classes of Directors Appointed:

   • Managing Director: Holds complete authority and responsibility for the company's operation.
   • Executive Director: Manages day-to-day operations and holds a high level of responsibility.
   • Non-Executive Director: Not involved in daily operations or decision-making.
   • Nominee Director: Represents the interests of PE/VC investors, banks, or shareholders.
   • Independent Director: Ensures sound governance and oversight.

It's important to remember that these principles are based on the Companies Act 2013 and might vary based on jurisdiction and local regulations. Always refer to the specific laws and regulations applicable to the country in question for accurate and up-to-date information.