Appointment of Directors How are the Directors appointed?

The discussion on appointment of a director may be grouped under the following heads :

1. Appointment of First Directors,

2. Appointment at General Meeting,

3. Appointment by the Board of Directors, .

4. Appointment by Third Parties, and

5. Appointment by Central Government.

1. Appointment of First Directors (Sec. 254)

The first directors are usually appointed by name in the Articles or in the manner provided therein. Where the Articles do not provide for the appointment of

first directors, those of the subscribers to the Memorandum who are individuals shall be deeme@Uo be first directors of the company, subject to the

regulations of the company’s Articl ere all subscribers to the memorandum are body corporates,office until the directors are duly appointed in

accordance with the provisions of Section 255 (Section 254).

2. Appointment of Directors at General Meeting (See. 255)

According to Section 255, the directors must be appointed by the company in general

meeting. In the case of a public company or of a private company which is a subsidiary

of a public company, unless the Articles provide for the retirement of all directors at every annual general meeting, at least two-thirds of the total number of

directors must

be persons whose period of office is liable to determination by rotation. In other words, only

one-third of the total number of directors can be non-rotational directors.

Section 256 states that of the directors subject to retirement by rotation, one-third or a number near to one-third shall retire at an annual general mting.ln

the first place, those directors shall retire who have been longest in office since their last appointment. As between persons appointed on the same day,

retirement is to be determined by mutual consent and in case of default, by lots.’

So far’ as a private company, which is not a subsidiary of a public company, is concerned, if its Articles are silent as to the appointment of directors or do

not specifically provide for appointment of directors otherwise than in general meeting then the directors are to be appointed in general meeting by the