Appointment of an employee as a director in a private compan
This query is : Resolved
29 April 2013
If an employee is appointed as a director in a private company, then will it be sufficient if SR is passed approving the said appointment or CG approval will also be needed?
29 April 2013
Hi
For this Board Resolution will be sufficient.
The provisions of Companies Act, 1956 relating to the remuneration of directors is not applicable to private limited company. So the company is free to appoint through Board Meeting, subject to the Company's articles.
For this Board Resolution will be sufficient.
The provisions of Companies Act, 1956 relating to the remuneration of directors is not applicable to private limited company. So the company is free to appoint through Board Meeting, subject to the Company's articles.
29 April 2013
Thank you. But will section 314 not be attracted in this case?
29 April 2013
Hi
Section 314 will be applicable if director receive any remuneration in the position of place of profit other than place of director.
If you are not paying any payment to director and paying remuneration for other position then 314 will apply.
But your above mentioned query are not talking about that.
Section 314 will be applicable if director receive any remuneration in the position of place of profit other than place of director.
If you are not paying any payment to director and paying remuneration for other position then 314 will apply.
But your above mentioned query are not talking about that.
29 April 2013
One employee 'X' receives remuneration from the company. So if he is appointed as a director of that company, then sec 314 gets attracted. My query is will special resolution be sufficient in this case or approval of CG will also be required?
29 April 2013
Confirm, whether he receive remuneration as a director of the company or not.
30 April 2013
On his appointment as a director of the company, he will not receive any remuneration other than what he was receiving as the employee of the company.
30 April 2013
It means you are not paying any remuneration to him as director. In that case section 314 will attract.
If a director receiving any money in other position in addition to director will covered under section 314.
If a director receiving any money in other position in addition to director will covered under section 314.
30 April 2013
Yes. Since section 314 is being attracted, so will it be sufficient if SR is passed in GM approving the appointment or CG approval will also be required?
30 April 2013
Its depend on your remuneration amounts if it exceed Rs. 250000, then CG approval will be required otherwise SR will be sufficient.
30 April 2013
Thanks a lot for the guidance.
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