Companies (Appointment and Qualification of Directors) Rules, 2014
MINISTRY OF CORPORATE AFFAIRS
New Delhi, the 22nd October, 2019
G.S.R. 804(E).— In exercise of the powers conferred by section 149 read with section 469 of the Companies
Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies
(Appointment and Qualification of Directors) Rules, 2014, namely:-
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1. (1) These rules may be called the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules,
(2) They shall come into force with effect from the 1st day of December, 2019.
2. In the Companies (Appointment and Qualification of Directors) Rules, 2014 (hereinafter referred to as the principal
rules), for rule 6, the following rule shall be substituted, namely: –
“6. Compliances required by a person eligible and willing to be appointed as an independent director.
(1) Every individual –
(a) who has been appointed as an independent director in a company, on the date of commencement of
the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019, shall
within a period of three months from such commencement; or
(b) who intends to get appointed as an independent director in a company after such commencement,
shall before such appointment,
apply online to the institute for inclusion of his name in the data bank for a period of one year or five years or
for his life-time, and from time to time take steps as specified in sub-rule (2), till he continues to hold the office
of an independent director in any company:
Provided that any individual, including an individual not having DIN, may voluntarily apply to the institute for
inclusion of his name in the data bank.
(2) Every individual whose name has been so included in the data bank shall file an application for renewal for a
further period of one year or five years or for his life-time, within a period of thirty days from the date of expiry
of the period upto which the name of the individual was applied for inclusion in the data bank, failing which, the
name of such individual shall stand removed from the data bank of the institute:
Provided that no application for renewal shall be filed by an individual who has paid life-time fees for inclusion
of his name in the data bank.
(3) Every independent director shall submit a declaration of compliance of sub-rule (1) and sub-rule (2) to the
Board, each time he submits the declaration required under sub-section (7) of section 149 of the Act.
(4) Every individual whose name is so included in the data bank under sub-rule (1) shall pass an online
proficiency self-assessment test conducted by the institute within a period of one year from the date of inclusion
of his name in the data bank, failing which, his name shall stand removed from the databank of the institute:
Provided that the individual who has served for a period of not less than ten years as on the date of inclusion of
his name in the databank as director or key managerial personnel in a listed public company or in an unlisted
public company having a paid-up share capital of rupees ten crore or more shall not be required to pass the
online proficiency self-assessment test:
Provided further that for the purpose of calculation of the period of ten years referred to in the first proviso, any
period during which an individual was acting as a director or as a key managerial personnel in two or more
companies at the same time shall be counted only once.
Explanation: For the purposes of this rule,-
(a) the expression “institute” means the ‘Indian Institute of Corporate Affairs at Manesar’ notified
under sub-section (1) of section 150 of the Companies Act, 2013 as the institute for the creation and
maintenance of data bank of Independent Directors;
(b) an individual who has obtained a score of not less than sixty percent. in aggregate in the online
proficiency self-assessment test shall be deemed to have passed such test;
(c) there shall be no limit on the number of attempts an individual may take for passing the online
proficiency self-assessment test.”
[F. No. 8/4/2018-CL-I- Part II]
K. V. R. MURTY, Jt. Secry.
Note:—The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, sub-section (i) vide
notification number G.S.R. 259(E) dated the 31st March, 2014 and were last amended vide notification number
G.S.R. 750(E) dated the 30th September, 2019.