Section 9 of The Small Industries Development Bank of India Act, 1989
1[9. Vacation and resignation of office by directors.--(1) The office of a director shall become vacant if he--
- (a)becomes subject to any of the disqualifications mentioned in section 8; or
- (b)resigns his office by giving notice in writing under his hand and the resignation is accepted; or
- (c)absents himself from three consecutive meetings of the Board without obtaining leave of absence from the Board.
- (2)Notwithstanding anything contained in clause (a) of sub-section (1), the disqualifications referred to in that clause shall not take effect--
- (a)for thirty days from the date of the adjudication, sentence or order;
- (b)where any appeal or petition is preferred within thirty days aforesaid against the adjudication, sentence or conviction resulting in the sentence or order until the expiry of seven days from the date on which such appeal or petition is disposed of; or
- (c)where within the seven days aforesaid, any further appeal or petition is preferred in respect of the adjudication, sentence, conviction or order and the appeal or petition, if allowed, would result in the removal of the disqualification, until such further appeal or petition is disposed of.]
Summary
- A director's seat becomes vacant if they hit any of the disqualifications from Section 8, resign in writing and get accepted, or miss three consecutive Board meetings without permission.
- If a director is disqualified by a court sentence or bankruptcy order under Section 8, they do not lose their seat immediately.
Practical examples
FAQ
1. Does a resignation take effect as soon as the director hands in the letter?
No, the resignation must be in writing under the director's hand and it must be formally accepted before the office becomes vacant.
2. If a director misses two meetings in a row without asking, do they lose their job?
No, the rule specifies that they must absent themselves from three consecutive meetings without obtaining a leave of absence.
Test yourself
Q1.Under Section 9 of The Small Industries Development Bank of India Act, 1989, what is the specific condition regarding absences that causes a director's office to become vacant?
Q2.Under Section 9 of The Small Industries Development Bank of India Act, 1989, how does the law handle a director who is hit with a court sentence that would normally disqualify them under Section 8?
Q3.Under Section 9 of The Small Industries Development Bank of India Act, 1989, if a director loses their initial appeal against a conviction, what must they do to prevent immediate removal from the board?
Q4.Under Section 9 of The Small Industries Development Bank of India Act, 1989, which of the following scenarios legally finalizes a director's resignation?