Section Text
( 1 ) A company may, by ordinary resolution, remove a director (not being a director appointed by the Central Government in pursuance of section 408 ) before the expiry of hi s period of office:
Provided that this sub-section shall not, in the case of a private company, authorise the removal of a director holding office for life on the 1 st day of April, 1952 , whether or not he is subject to retirement under an age limit by virtue of the articles or otherwise:
Provided further that nothing contained in this sub-section shall apply where the company has availed itself of the option given to it under section 265 to appoint not less than two-thirds of the total number of directors according to the principle of proportional representation.
( 2 ) Special notice shall be required of any resolution to remove a director under this section, or to appoint somebody instead of a director so removed at the me eting at which he is removed.
( 3 ) On receipt of notice of a resolution to remove a director under this section, the company shall forthwith send a copy thereof to the director concerned, and the director (whether or not he is a me mber of the company) shall be entitled to be heard on the resolution at the me eting.
( 4 ) Where notice is given of a resolution to remove a director under this section and the director concerned makes with respect thereto representations in writing to the company (not exceeding a reasonable length) and requests (he ir notification to me mbers of the company, the company shall, unless the representations are received by it too late for it to do so, -
(a) in any notice of the resolution given to me mbers of the company state the fact of the representations having been made; and
(b) send a copy of the representations to every me mber of the company to whom notice of the me eting is sent (whether before or after receipt of the representations by the company);
and if a copy of the representations is not sent as aforesaid because they were received too late or because of the company's default, the director may (without prejudice to hi s right to be heard orally) require that the representations shall be read out at the me eting:
Provided that copies of the representations need not be sent out and the representations need not be read out at the me eting if, on the application either of the company or of any other person who claims to be aggrieved, the1[Central Government] is satisfied that the rights conferred by this sub-section are being abused to secure needless publicity for defamatory mailer; and the1[Central Government] may order the company's costs on the application to be paid in whole or in part by the director notwithstanding that he is not a party to it.
( 5 ) A vacancy created by the removal of a director under this section may, if he had been appointed by the company in general me eting or by the B oard in pursuance of section 262 , be filled by the appointment of another director in hi s stead by the me eting at which he is removed, provided special notice of the intended appointment has been given under sub-section ( 2 ).
A director so appointed shall hold office until the date up to which hi s predecessor would have held office if he had not been removed as aforesaid.
( 6 ) If the vacancy is not filled under sub-section ( 5 ), it may be filled as a casual vacancy in accordance with the provisions, so far as they may be applicable, of section 262 , and all the provisions of that section shall apply accordingly:
Provided that the director who was removed from office shall not be re-appointed as a director by the B oard of directors.
( 7 ) Nothing in this section shall be taken -
(a) as depriving a person removed there under of any compensation or damages payable to hi m in respect of the termination of hi s appointment as director or of any appointment terminating with that as director; or
(b) as derogating from any power to remove a director which may exist apart from this section.
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1. Substituted by Act 31 of 1988, sec. 67, for "Court" (w.e.f. 31-5-1991) and again substituted by Act 11 of 2003, sec. 34, for "Company Law Board".