Applicability of sec 297 to director remuneration

This query is : Resolved

Muthu (Querist)
Follow

06 September 2013 If a director of private limited company having paid up capital above 1 crore, is paid consultancy fee then will central government approval be required. circular of MCA 05/06/1975 says it is applicable on supply of service and not on personal service isn't director service personal in nature also also section 309 on director remuneration is not applicable to private company which override sec 297 therefore shouldnt director remuneration be exempt from approval of central government.

Ajay Mishra

Ajay Mishra (Expert)
Follow

06 September 2013 Section 297 does not apply to:

1. Giving or taking loans.
2.Contract in respect of immovable property (as it is not 'good' ).{Letter No. 9/4190-CL-X dated 27.03.1990}.
3.Contract between two public Companies.
4.Contract of employment of director or managing or whole time director.[ Circuler No.8/11/75-CL-V dated 27.03.1975]
5.Contract for employment of relative of director.
6.Contract entered into by the company with the dealer on principle to principle basis. [Circuler No. FM 8/297/56-PR dated 02-08-1956]
7. Professional services of the nature given by firms of solicitors and advocates, etc.[circuler No. 8/11/75-CL-V dated 05.06.1975]
8.hiring of office premises on rent as the transaction is in immovable property. [Department Clarification dated 10-09-1990]

Ajay Mishra

Ajay Mishra (Expert)
Follow

06 September 2013
The provisions of Companies Act, 1956 and Schedule XIII deal with remuneration of director will not applicable to private limited company. Such provision is applicable only public company and its subsidiary.

The remuneration of directors of the private company is totally governed by their company articles. If the Company’s article permits to pay remuneration you can give remuneration without any restriction. For this you will pass a Board Resolution for payment of remuneration.

Message likes : 1 times

Muthu

Muthu (Querist)
Follow

06 September 2013 Thank you so Much !!

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

Namita Fule

Amit Yadav

Krishnan V

sriram deven

PARAS CHHAJED

Subscribe Now

Applicability of sec 297 to director remuneration

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Manager- Finance and Compliance

Article Assistant

CA Final

GST CONSULTANCY

GST CONSULTANT

Accountant