Introduction
The resignation of an independent director in a listed company is a significant event that necessitates careful adherence to legal protocols. This comprehensive checklist outlines the step-by-step requirements and actions to ensure a compliant and transparent process when an independent director tenders their resignation.
Compliance Checklist – Resignation of Independent Director in a Listed Company
| Sr. No. | Governing Sections / Requirements | Steps / Particulars |
| 1. | Sections 168(1) and 173 of the Companies Act, 2013 (‘Act’) & SS -1 | – To receive Resignation Letter from the Independent Director (ID) stating detailed reasons for resignation and confirmation from ID stating that there are no other material reasons for this resignation other than those provided in resignation letter. |
| 2. | Regulation 30 of the SEBI (LODR) Regulations, 2015 (‘Listing Regulations) read with clause 7 of clause A in part A of Schedule III of the SEBI (LODR) Regulations, 2015 | – Stock Exchange intimation about the Change in Management |
| 2 | Regulation 30 of the Listing Regulations read with clause 7B of clause A in Part A of Schedule III of the SEBI (LODR) Regulations, 2015 | – Stock Exchange intimation about the resignation of ID
a. Letter of Resignation Letter from the Director stating detailed reasons for resignation b. Confirmation from ID stating that there are no other material reasons other than those provided for his resignation c. Names of the listed entities in which such resigning ID holds directorship, indicating the category of Directorship and Membership of Board or Committees, if any. (Disclosure to be submitted within 7 days from the date of resignation. |
| 3 | Section 168(1) read with Rule 15 of the Companies (Appointment and Qualifications of Directors) Rules, 2014 | – File intimation with ROC within 30 days of resignation in Form DIR -12 along with the resignation letter and date of receipt of resignation letter |
| 4 | Section 170 read with Rule 17(1) the Companies (Appointment and Qualifications of Directors) Rules, 2014 | – Make necessary entries in the Register of Directors |
| 5 | Reconstitution of Committee pursuant to the provisions of the Listing Regulations and Act. | – To reconstitute the Committees in which the ID was member or Chairperson |
| 6. | Website Updating pursuant to the provisions of Reg. 46 the Listing Regulations | – The Website must be updated to that effect. |
Conclusion
The process of an independent director’s resignation in a listed company involves a series of crucial steps to maintain legal and regulatory compliance. By following this meticulous checklist, companies can ensure a smooth and transparent transition during the resignation process. Adhering to these guidelines not only upholds the company’s integrity and governance but also builds trust among stakeholders by showcasing a commitment to following prescribed legal procedures.
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