Section 167 of CA 2013 : Section 167: Vacation Of Office Of Director

Explanation using Example

Imagine that Mr. John Doe is a director at XYZ Pvt. Ltd. During an audit, it's discovered that he has not attended any board meetings for the past 13 months. Despite being reminded of his duties and the importance of participation, he did not seek leave of absence from the Board. According to Section 167(1)(b) of the Companies Act, 2013, Mr. Doe's directorship is at risk. The company informs Mr. Doe that his office as a director has become vacant due to his continuous absence, and he must step down from his position. XYZ Pvt. Ltd. then proceeds to appoint a new director to fill the vacancy as per the company's Articles of Association and the provisions of the Act.