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Maximum Number of Directorship of a Person in Companies

Directorship Limit

Refer Section 165(1) of the Companies Act, 2013.

A person can be a Director in a maximum of 20 companies at any point of time.

A person can not be a Director of more than 10 public companies at the same time.

Limit Calculation

In the calculation of max. 20 companies limit -
alternate directorship is to be included;
• directorship in a dormant company is not to be included.

In the calculation of max. 10 public companies limit -
• directorship in private companies which are either holding or subsidiary company of a public company is to be included.

Restriction

By passing a special resolution, the members/shareholders of a company may specify any lesser number of companies in which a director of the company may act as directors.

Penalty/Punishment

In case a person becomes a director of another company after crossing the maximum limits as mentioned hereinabove, he shall have to pay penalty of Rs. 5000 for each day of such contravention.

Here, the contravention starts from the day of his appointment in that new company till the day he resigns and his directorship comes under the limit as prescribed.

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