Family Business Dilemma: How Do I Remove Myself as a Director After Resigning?

Dear Sir,

I was engaged in my family business from 2005 to 2014. In May 2015, I left the company and submitted resignation letters to all five companies. However, three days ago, I discovered that they are still using my name. I am currently listed as a director in two of the companies. Please advise me on how to resolve this critical issue. How can I address it?

Thank you.

Clarification on Company Constitution and Resignation Process

Your question does not specify whether the companies are Private Limited or Public Limited. Assuming they are either Private or Public Limited, merely handing over a resignation is not sufficient. As per your statement, "I came to know that they are using my name... I am still a director in 2 companies," it is advisable for you to obtain a certified copy of the Company Resolution in this regard.

As you were an ex-director, you must have signed various documents pertaining to your company’s financiers, which may include private entities or banks. It is advisable for you to inform every financier about your resignation and obtain due acknowledgment from them for your safety. Moreover, you may publish a public notice in a local newspaper with wide circulation in this regard through a lawyer, in both English and a vernacular language.

With the help of a Company Secretary, you may also inform the ROC (Registrar of Companies). The intimation to financiers or bankers will limit your personal liability until your date of resignation.

Regards

It's your family business. You should be able to resolve this internally. Just tell the other family members that you have resigned and you want your name removed.

Procedure for Resignation of Director of Company & Compliance

You need to file form DIR 11. Once you have filed it, your resignation is effective. Remember that it has to be signed by you and not the company. They then have to file a different form.

If you know the bankers and other main stakeholders, you may send each of them letters informing them of your resignation. To the bank, you can simply forward a copy of the resignation letter and form DIR 11. To customers and vendors, send a mail informing them you are no longer a director and that all communication with the company must be sent to xyz.

Hi Saswata Sir,

Thank you for the guide.

I want to be removed from this because they are defaulters from the bank. They also used my father. However, when they needed a signature from me on loan papers, I denied them. The story is one and a half years old.

Can you please tell me if the DIR form is available on the internet? Once I fill out this form, what do I have to do?

Can I give the DIR form after filling it out and signed by me to my big brother's company? Or should I ask them to fill out the form themselves?

Because, sir, I am very new to the company's system.

Yes, DIR-11 (Notice of resignation to Registrar) is available on MCA 21 site. You can download the same and file it with your DSC, attaching your resignation letter served by you.

The form is available online at the MCA website. However, it is better if you take the help of a company secretary to get it done. The form has to be filed by you personally. Giving it to the company or your brother is not going to work. You can resign with retrospective effect (based on the resignation letter date you originally gave) by paying penalty fees for filing late. Of course, you need to have a digital signature.