Remuneration
This query is : Resolved
Pankaj Arora
(Querist)
06 May 2017
Mr A (executive director)drawing salary from ABC limited and PQR Pvt Ltd .. if we have to calculate maximum remuneration ceiling under companies act than we have to club salary drawn from ABC Limited and PQR Pvt Ltd together..??
Ankur Singhal
(Expert)
06 May 2017
Dear
The limit for remuneration under companies act is on company, not on person.
the limit applies on company basis.
Pankaj Arora
(Querist)
06 May 2017
okay, suppose abc limited can pay maximum remuneration to its director 50 Lakh according to effective capital. now we have to include the remuneration received by MR X from PQR limited also with 50 lakh ceiling under ABC ltd
21 July 2025
Great question! Let me clarify:
Under the Companies Act, the remuneration ceiling is applied by each company individually, not on the total amount a director receives from multiple companies.
So, in your example:
ABC Limited has a maximum remuneration limit of ₹50 lakh for its directors based on its effective capital.
PQR Pvt Ltd will have its own separate limit based on its effective capital.
The ₹50 lakh ceiling applies only to the remuneration ABC Limited pays to Mr. A — it does not include salary Mr. A receives from PQR Pvt Ltd.
Summary:
Remuneration limits are per company, not aggregated across all companies where the director works.
So you do not club remuneration from different companies when calculating the maximum permissible remuneration ceiling under the Companies Act.
Under the Companies Act, the remuneration ceiling is applied by each company individually, not on the total amount a director receives from multiple companies.
So, in your example:
ABC Limited has a maximum remuneration limit of ₹50 lakh for its directors based on its effective capital.
PQR Pvt Ltd will have its own separate limit based on its effective capital.
The ₹50 lakh ceiling applies only to the remuneration ABC Limited pays to Mr. A — it does not include salary Mr. A receives from PQR Pvt Ltd.
Summary:
Remuneration limits are per company, not aggregated across all companies where the director works.
So you do not club remuneration from different companies when calculating the maximum permissible remuneration ceiling under the Companies Act.
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