Age Criteria of Directors under Companies Act, 2013
- Section 196 of the companies Act, 2013 contains provisions about Appointment of Whole Time Director/Managing Director or Manager in an exceedingly company.
- The section contains provisions on who qualifies to be a director during a company.
- The section contains many events that render an individual disqualified from becoming a director. One in every of the criteria mentioned within the section is age of a personal who wants to become a director.
- Our scope of debate during this article would be the Minimum and maximum age of Directors. we’ll be discussing the provisions of law during this regard and also correlate it with prevalent laws within the country.
- Requirements to become the director of a company are:
- Age limit
- Nationality of the director
- Disqualifications of becoming a Director
Provisions in Respect of Age Limit of Directors
- Section 196(3) of the companies Act,2013 states that any company shouldn’t employ a manager, whole-time director or manager who is below the age of 21years or an individual who is above age of 70 years.
- In case a corporation wants to appoint someone, who has crossed an age of 70 years than an organization may do so by passing a special resolution.
- The explanatory statement should be given the notice for such motion, where justification should tend to rent that person.
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Applicability of Above Provisions
- As discussed above, a specific criteria has been provided under the provisions of Sec.196 (3), in respect of WTD/Manager/MD.
- However, it is also seen that some of other Key Managerial Personnel are also appointed as directors in the form of Non-Executive Director, Independent Director, Additional Director etc.
- The Company Act is silent about the ordinance for these directors.
Now some of the questions that arises here are –
- How to determine about age of those directors?
- What are the other statutes than are often mentioned in respect of this matter?
- Will any other statutes have an overriding effect on the companies Act provisions?
- Does the other law states otherwise?
To answer the above question, we want to work out that if the other law possesses the other provisions during this regard. Additionally, to Companies Law, the listed companies are regulated by SEBI.
SEBI (LODR) Regulations, 2015
As per these regulations, the following provisions shall be applicable –
- For an Independent Director, a minimum age limit of 21 years has been prescribed.
- A Non-executive director shouldn’t be quite age of 75 years. If such person must be appointed a Special Resolution should be passed.
It is to be noted that the said provisions under SEBI (LODR) shall be applicable only on Listed Companies. To the current extent these provisions are going to be applicable over and above companies Act.
Till now, it has been cleared that –
- Companies Law is the governing law for laying down the provisions in respect of WTD/MD/Manager.
- On the other hand, SEBI (LODR) Regulations provides the provisions in respect of Independent Director and non-executive directors and that too only in case of listed entities.
So now there’s no provision in law for
- Directors apart from WTD/MD/Manager just in case of non-listed companies.
- Maximum age for Independent Directors and minimum age for Non-ED just in case of listed companies.
- What happens to directors aside from as mentioned in above 2 points?
- Well within these cases we are able to take refuge in the oldest act that governs the idea of any contract i.e. Indian Contract Act, 1872. As per this someone below an age of 18 years cannot enter into a legitimate contract. Even while applying for DIN i.e. Director’s number the age of the one who applies for the DIN should be a minimum of 18 years.
- However, still the most age remains an unanswered question. If a director is treated as an employee than the maximum age shall be the retirement age of the employees but this is again not a provision I law.
|Kind of Directors||Non-listed Company||Listed company|
|MD/WTD/Manager||Minimum: 21 years
Maximum : 70 years
Minimum: 18 years
Maximum : no limit
|Minimum : 21 years
Maximum : 75 years
|Other NEDs||Minimum: 18 years
Maximum : 75 years
|Other than above||Minimum: 18 years
Maximum : no limit
Ans of above mentioned query :
a. SEBI (LODR) Regulations exclusively talks about what is applicable to the listed company over and above what is provided in the Co. Act, 2013. so, wherever there is no specific mention as to the age of a particular category of Director in SEBI (LODR) Regulations, Companies Act shall prevail.
b. Min : 18 YR ; Max: no limit.
All about of Whole Time director under Companies Act, 2013
- From above discussion it’s clear, that law has left many unanswered questions during this aspect. By correlating other acts also we cannot cover all if and but during this regard.
- So, minimum age can still be considered as 18 years as an individual below that age won’t be eligible to induce DIN which may be a compulsory requirement for being a director.
- However, the utmost age aside from cases covered specifically within the act remains unclear or we will say there’s no limit thereto. So, this was the discussion about Minimum and Maximum age of directors, we hope it absolutely was a helpful read.
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