CAN ARTIFICIAL INTELLIGENCE BECOME A SHADOW DIRECTOR?- REINTERPRETING SECTIONS 2(59) & 166 OF THE COMPANIES ACT, 2013 IN THE ERA OF AUTONOMOUS CORPORATE DECISION-MAKING

Artificial Intelligence (AI) is increasingly transforming corporate governance by assisting boards in strategic planning, financial reporting, risk management, compliance, and decision-making. While AI improves efficiency and accuracy, its growing influence raises important legal questions concerning accountability, fiduciary duties, and the adequacy of existing company law. This paper examines whether AI can be recognised as a shadow director under Section 2(59) of the Companies Act, 2013, and analyses the impact of AI on directors' duties under Section 166. Using a doctrinal research methodology based on statutory provisions, judicial decisions, comparative jurisprudence, and scholarly literature, the study argues that AI cannot presently qualify as a shadow director because it lacks legal personality and cannot bear legal rights or fiduciary obligations. The paper concludes that directors remain fully liable for AI-assisted decisions and recommends greater algorithmic transparency, meaningful human oversight, and progressive reinterpretation of company law to address emerging AI-driven governance challenges.