Many Companies Can One explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Twenty. But the sub-limit on public companies is what actually constrains people, and the counting rules have two traps in them.
Section 165: a maximum of 20 companies, including alternate directorships, of which no more than 10 may be public companies. Private companies that are a holding or subsidiary of a public company count as public. Dormant companies and Section 8 companies are outside the count. Members can set a lower limit by special resolution. Exceeding it costs ₹2,000 a day up to ₹2,00,000 — and is a disqualification ground.
The two limits
| Limit | Number |
|---|---|
| Total companies (including alternate directorships) | 20 |
| Of which, public companies | 10 |
Both apply at the same time. You can hold twenty directorships only if at least ten of them are in private companies that don't count towards the public sub-limit.
What counts and what doesn't
Counts towards the twenty:
- Public companies
- Private companies
- Alternate directorships
- One person companies
Counts as "public" for the ten sub-limit:
- Public companies, listed or unlisted
- Private companies that are a holding or subsidiary company of a public company
Doesn't count at all:
- Dormant companies under Section 455 — expressly excluded from the twenty
- Section 8 companies — excluded under the exemptions available to them
Trap 1: the private subsidiary. A private company that is a subsidiary of a public company is treated as public for this count, even though it's private for almost every other purpose. If you sit on several boards inside a listed group, a number of the "private" ones are probably eating your public quota.
Trap 2: status changes. A private company becomes a subsidiary of a public company through a transaction you had nothing to do with. Your count changes without you doing anything, and nobody tells you.
A useful relief: Section 8 company directorships are free. Not-for-profit board work — a foundation, a school, an industry association structured as a Section 8 company — doesn't consume your quota. That's deliberate policy, and worth knowing if you're asked to help.
Companies can tighten it
Under Section 165(2), the members of a company may, by special resolution, specify a lesser number of companies in which its directors may hold directorships.
Some companies do this in their governance policy — particularly where they want executive directors focused. Check the articles and any board policy before assuming twenty is your ceiling.
The separate SEBI caps
If any of your seats are in listed entities, further caps apply on top of Section 165:
- 7 listed entities as a director in any capacity.
- 7 listed entities as an independent director.
- 3 independent directorships if you're a whole-time director or managing director in any listed entity.
- 10 committee memberships and 5 chairmanships across all listed entities, counting only audit and stakeholders relationship committees.
- High-value debt listed entity seats now count towards the listed entity caps.
These are tighter than Section 165, so a person active on listed boards usually hits a SEBI cap long before the twenty-company one.
What happens if you exceed
A daily penalty. A person who accepts an appointment in contravention of Section 165(1) is liable to a penalty of ₹2,000 for each day the contravention continues after the first, subject to a maximum of ₹2,00,000.
And a disqualification. Non-compliance with Section 165(1) is a ground of disqualification under Section 164(1). Which means exceeding the cap doesn't just cost money — it can affect your standing on every board you sit on.
That combination is why this is worth counting carefully rather than approximately.
Keeping the count right
- Maintain a live list of every directorship with the company's exact status: listed, HVDLE, unlisted public, private, private-subsidiary-of-public, dormant, Section 8.
- Recount before accepting anything new — all the caps, every time.
- Re-check when a group restructures. Status changes move companies between columns.
- Track committee seats separately.
- Keep your MBP-1, DIR-2 and databank profile accurate — these are what get checked.
Key takeaways
- 20 companies, of which 10 public.
- Alternate directorships count.
- Private subsidiaries of public companies count as public.
- Dormant and Section 8 companies don't count at all.
- Members can set a lower limit by special resolution.
- SEBI's listed entity caps are tighter and usually bind first.
- ₹2,000 a day up to ₹2,00,000, plus disqualification under Section 164.
Read next
- How Many Listed Company Directorships Can One Person Hold?
- Director Disqualification and Vacation of Office
- Regulation 25 of SEBI LODR: Every Obligation of an Independent Director
- Independent Directors in Section 8 and Government Companies
Law stated as on 5 September 2026.