The provisions relating to Automatic/Deemed Re-appointment of Retiring Directors at the Annual General Meeting of a Public Limited Company are prescribed in the sub-section 7 of the section 152.
There are mainly two steps involved in Automatic/Deemed Re-appointment of Retiring Directors.
(1) Adjournment of the Annual General Meeting;
(2) Automatic/Deemed Re-appointment of Retiring Directors at the adjourned AGM.
1. Adjournment of the Annual General Meeting
There are mainly two situations when AGM gets adjourned in this case.
(1) If the vacancy of the retiring director is not so filled-up in the AGM; or
(2) if the meeting has not expressly resolved not to fill the vacancy.
Then the AGM stands adjourned till the same day in the next week, at the same time and place, or if that day is a national holiday, till the next succeeding day which is not a holiday, at the same time and place.
2. Automatic/Deemed Re-appointment of Retiring Directors at the adjourned AGM.
If at the adjourned meeting also,
(1) the vacancy of the retiring director is not so filled-up; or
(2) the meeting has not expressly resolved not to fill the vacancy;
Then the retiring director shall be deemed to have been re-appointed at the adjourned meeting.
Circumstances wherein the Automatic Re-appointment of the Retiring Directors is not allowed:
(i) at that adjourned meeting or at the previous annual general meeting a resolution for the re-appointment of such director has been put to the meeting and lost;
(ii) the retiring director has expressed his unwillingness to be so re-appointed, by a notice in writing addressed to the company or its Board of directors;
(iii) he is not qualified or is disqualified for appointment;
(iv) a resolution, whether special or ordinary, is required for his appointment or re-appointment by virtue of any provisions of this Act; or
(v) section 162 is applicable to the case.
(1) The corresponding provisions for section 152 of the companies act 2013 was earlier prescribed under section 256 of the companies act 1956.
(2) If there was no Annual General Meeting or Adjourned Meeting thereto, then the automatic re-appointment will also not be valid.
(3) “Retiring director” means a director retiring by rotation.