Commission to a non-executive director of a private limited

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VICKY SRIVASTAV (Querist)
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25 March 2013 Dear Friends,

Is Ceiling for Commission i.e. 1% of Net Profit or, 3% of Net Profit to a non-executive director of a Private limited Co. applicable or, not applicable?

Now, If, the above Ceiling is not applicable then , A private Limited Co. has esteemated Net profit for F.Y. 2012-13 is Rs. 6 Crores and said Co. given the Commission to a non-executive director i.e. Rs. 30,00,000/- (above 3% of N.P., and Co. have no M.D./W.D./Manager).
Is it Correct ? if Not Correct thn what should be Correct amounts of Commission ? Please advise.

Regards,

Vicky Srivastav

Ajay Mishra

Ajay Mishra (Expert)
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25 March 2013 Hi

The provisions of remunerations to directors of the Companies Act, 1956 will not applicable to private limited company. Its totally govern by their articles.

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