Applicablity of Sec. 314

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

24 April 2010 If remuneration to directors of a Company increased & all such directors are relative of one another, then in such case provisions of sec. 341 are applicable or not i.e. (variation in salary & commission) place of profit/office and what kind of resolution needs to be passed to give effect to above business.

Thanks & regards
Abhishek Sharma

Jagruti (CS)

Jagruti (CS) (Expert)

27 April 2010 If the icnrease in remuneration is complied under Section 310 than Section 314 compliance is not required.

As stated if all the directors are related than such increase should be with approval of shareholders and not in Board Meeting.

Querist : Anonymous

Querist : Anonymous (Querist)

27 April 2010 but if all shareholders are also relative u/s 6 then 314 would be applicable or not as previously Co. is paying them salary but according to new alteration they are now elegible to get Fixed % of Profits in Co. but that % + Salary dose not exceeds maximum limit under law.

Thanks & regards
Abhishek Sharma

Guest

Guest (Expert)

27 April 2010 above reply was wrong.

Section 314 applicable only when it is first appointment.

Increase of the remuneration in the later times doesnt fall under that