The Disqualification Trigger
Section 164(2) disqualifies a person from being appointed as a director of any company if the company in which he is a director has not filed financial statements or annual returns for three consecutive financial years. The disqualification operates for five years from the date of the default. The disqualification is personal to the director and applies across all companies.
The ROC’s List
The ROC publishes a list of disqualified directors. The list is based on the company’s filing defaults, and the director’s DIN is deactivated. A director who is on the list cannot be appointed in any company until the disqualification period expires or the disqualification is set aside.
The Defences
The director may challenge the disqualification on the ground that the company had filed the statements within the three-year period, that the director was not a director at the relevant time, or that the disqualification order was passed without notice. The director should obtain the company’s filing history and the ROC’s order before filing the challenge.
The Restoration Route
A director who is disqualified because of a company’s default may apply for restoration of the company under Section 252. If the company is restored and the filings are completed, the disqualification may be reviewed. The director should coordinate the restoration with the ROC’s disqualification cell.
Call to Action: For director disqualification challenge, DIN reactivation, or restoration coordination, contact office@anujdesaiassociates.com or 9619456656. Website: https://anujdesaiassociates.com. LinkedIn: linkedin.com/in/ca-anuj-desai-122547230.