Banking Regulation (Companies) Rules, 1949
5A. Determination of the Directors who are to cease to hold office
(1) The ascertainment of the Director or Directors who shall cease to be such, on the occasion of a reconstitution of the Board of Directors under sub-section (3) of section 10A of the Act, and of the person or persons who are to be removed from the membership of the Board of Directors in pursuance of sub-section (5) of the said section 10A, shall be done as hereinafter laid down.
(2) The Board of Directors or, as the case may be, the Reserve Bank, shall ascertain the number of Directors out of the ineligible Directors, who have to cease to hold the office, or, as the case may be, have to be removed from such Board.
(3) The names of the Directors who are to cease to hold office, or, as the case may be, have to be removed from the Board of Directors, shall be determined by drawing lots from among the names of the ineligible Directors, the names of such number of Directors, as is determined under sub-rule (2) above.
(4) For the purposes of sub-rule (3), the following provisions shall be observed, namely,-
( i ) the names of the ineligible Directors shall be grouped according to the periods for which the Directors have held office;
(ii) if there are two such groups only, the names of the Directors in the group representing a shorter period of office shall be excluded;
(iii) if there are more than two such groups, the names of those in the group representing the shortest period of office shall be excluded:
PROVIDED that such exclusion under clause (ii) or clause (iii) shall not be made if thereby the number of Directors whose names are to be included in the draw is not more than the number determined under sub-rule (2).
(5) The drawing of lots in pursuance of sub-section (3) of section 10A of the Act shall be done by the Board of Directors at a meeting of such Board.
(6) The drawing of lots of the Reserve Bank under sub-section (5) of section 10A of the Act shall be done by an officer of the Reserve Bank duly authorized in this behalf, and after giving a reasonable opportunity to the banking company to nominate a Director or officer of the banking company to be present at the time of the drawing of lots.]