Based on legal commentary and judicial interpretations, the vacation of office of a director for not attending board meetings under Section 167(1)(b) of the Companies Act, 2013 has a prospective effect. This means:

• Effective Date:
  The director’s office is declared vacant from the date of the board resolution or decision, and the effect is limited to future board meetings.

• No Retroactive Impact:
  Actions taken by the director prior to the resolution remain valid. The non-attendance that triggered the resolution does not retrospectively invalidate decisions or the director’s prior acts.

• Practical Implication:
  The director ceases to be a member of the board only from the moment the resolution takes effect. Past participation or decisions made before the resolution are not affected.

Yes, an alternate director is required to obtain a Director Identification Number (DIN) under Section 153 of the Companies Act, 2013. The requirement for a DIN applies to every person who is appointed as a director, and this includes alternate directors. Their role, though temporary, is still that of a director under the Act, and therefore they must secure a DIN before they can effectively perform their duties on the board.

Under Section 168 of the Companies Act, 2013, a director’s resignation becomes effective on the date the company receives the resignation notice, unless the notice specifies a later effective date. This means that once the director submits his resignation in writing to the company, his office is considered vacated from the receipt date (or the date stated in the notice) regardless of whether the company subsequently communicates the resignation to the Registrar of Companies.

For instance, if a director submits his resignation via email or physical notice on April 1, and no later date is mentioned, his resignation is effective from April 1. If a later effective date is mentioned in the notice, then his resignation will take effect on that specified date.

Yes,

Under the Companies Act, 2013, the term of an independent director is subject to a two-term limit—even if each term is less than five years. Specifically:

• Section 149(10) of the Act allows an independent director to be appointed for a term of up to five consecutive years.

• Section 149(11) provides that “notwithstanding anything contained in sub-section (10), no independent director shall hold office for more than two consecutive terms,” which means that even if each term is shorter than five years, the maximum number of consecutive terms an independent director can serve is two.

For example, if an independent director is appointed for a term of three years and then reappointed for a second term of three years, they cannot be immediately reappointed for a third consecutive term without a break. They must wait for a period (typically three years) after ceasing to be an independent director before they can be reappointed.

This provision ensures a regular infusion of fresh perspectives on the board, maintaining the independence and effectiveness of corporate governance.