Query on managerial remuneration u/s 197 of CA 2013
This query is : Resolved
06 November 2025
Sir
Section 197 of CA 2013 prima facie not applicable to Pvt Ltd Company.
My query is :
A Pvt ltd Company incorporated in India & wholly owned subsidiary of a Foreign Company(a big Company) does Section 197 applicable to that Pvt Ltd subsidiary Company ?
Regards
Abhijit
Section 197 of CA 2013 prima facie not applicable to Pvt Ltd Company.
My query is :
A Pvt ltd Company incorporated in India & wholly owned subsidiary of a Foreign Company(a big Company) does Section 197 applicable to that Pvt Ltd subsidiary Company ?
Regards
Abhijit
06 November 2025
No. - Being a subsidiary of a foreign company does not change its classification under Indian law. If it remains a private limited company, Section 197 does not apply.
Even if the foreign parent is a listed entity abroad or a large multinational, the Indian subsidiary’s compliance is governed by its own legal status under Indian law.
Even if the foreign parent is a listed entity abroad or a large multinational, the Indian subsidiary’s compliance is governed by its own legal status under Indian law.
07 November 2025
Thanks to Sir Dhirajlal Rambhia for sharing his view.
But Sir need a clarification that section 2(71) of CA 2013 inter alia states that pvt Co subsidiary of a Public Co shall also consider as Public Co..
In that case does a Foreign Company not incorporated under CA 2013 the provision of Sec 2(71) not apply to that Foreign Company irrespective that it may be a public/listed company?
Your kind view is expected.
Regards
Abhijit
But Sir need a clarification that section 2(71) of CA 2013 inter alia states that pvt Co subsidiary of a Public Co shall also consider as Public Co..
In that case does a Foreign Company not incorporated under CA 2013 the provision of Sec 2(71) not apply to that Foreign Company irrespective that it may be a public/listed company?
Your kind view is expected.
Regards
Abhijit
07 November 2025
If a foreign public company sets up a private limited subsidiary in India, then that Indian subsidiary may be deemed a public company under Section 2(71) if the foreign parent qualifies as a public company under Indian standards (e.g., not a private company as per Indian law). This is a nuanced area and often hinges on control, shareholding patterns, and the nature of the foreign parent.
- Section 2(71) defines a “public company” only in the context of companies incorporated under the Companies Act, 2013 (or any previous Indian company law). It does not apply to foreign companies.
- Section 2(71) defines a “public company” only in the context of companies incorporated under the Companies Act, 2013 (or any previous Indian company law). It does not apply to foreign companies.
07 November 2025
My sincere thanks to Sir Dhirajlal Rambhia to clarify my doubt.
Regards
Abhijit
Regards
Abhijit
07 November 2025
You are welcome,
09 November 2025
Good luck...
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Partnership Deed Changes for Remuneration
- F&O transactions question
- TDS DEDUCTED UNDER SECTION 194R WHERE TO SHOW IN ITR AND GST.
- Query related to job work
- HSN- GSTR 9
- Clarification regarding clubbing of AGM and EGM into one meeting
- Procedure for change in category of Director from Independent to Promoter Diretor
- Sale of agrilculture land exmpted for aerial distance calculation procedure for online
- Appointment of auditor in agm
- Filing of INC-22A -DSC error
- GST OFFICER WRONG NOTICE
- "Please ensure that the Total of the Deductions u/s 54F match the same in Table D in Sch CG"
- Composition Dealer GST Annual Return Filing process
- TDS under section 195.
- Filing GST Returns after death of proprietor
- Registered Required in GST Act
- Switch over to Composition Scheme
- Gstr 9 and itc
- Clarification regarding IMS
- RCM on Construction of Apartment - Real estate
Trending Online Classes
-
All Subjects Combo (Regular Batch) Jan & May 26
CA Hardik Manchanda,CS Arjun Chhabra & Prof. Akash Agrawal
CAclubindia
