04 October 2007
We have to give the directors salary amounting to Rs. 1 lakh pm of one of the dirctor of the private co.as DIRCTOR SALARY . Is there any prohibition or procedural to be followed. The article of association is silient on the director salary as such. Table A is also silent. Kindly reply.
04 October 2007
Remuneration to directors over and above Rs.50,000/- per month is required Central Government approval unless such director is a Whole Time Director or Managing Director.
04 October 2007
Ceiling of Managerial Remuneration not applicable to Pvt Ltd Companies. However Private company which is a subsidiary of a public co, to its directors and its managers shall come under the ceiling. (Sec 198 of the co's act)
04 October 2007
Yes, restriction on remunation will not attract, however you need to check Section 314 since it is applicable to both Public as well as private companies.
04 October 2007
The PVt company is not subsi of any public co.Sec 314 is not applicable since it is paid as director salary in his capacity as director not as employee etc.Can we give salary not mentioned in Articles Of Ass. and table A how?
04 October 2007
A.)SCHEDULE 1-TABLE A-REGULATION 65(1 ) OF COMPANY'S ACT SAYS "THE REMUNERATION OF THE DIRECTORS SHALL IN SO FAR AS IT CONSISTS OF A MONTHLY PAYMENT , BE DEEMED TO ACCRUE FROM DAY TO DAY". 2. IN ADDITION TO REMEUNERATION .... DIRECTORS MAY BE PAID,TRAVEL.,HOTEL, AND OTHER EXP. PROPERLY INCURRED BY THEM--- B.)AS FOR ARTICLES OF ASSOCIATION, GENERALLY IT DOES NOT CONTAIN FIGURES BUT MAY CONTAIN LIMITS . IF WE WISH TO PAY SALARY TO A DIRECTOR BEYOND AND ABOVE LIMITS IF ANY SPECIFIED IN ARTICLES, WE NEED TO AMEND THE ARTICLES BY A SPECIAL RESOLUTION PASSED BY THE GENERAL BODY OF SHARE HOLDERS. R.V.RAO
04 October 2007
Regulation 65 of Table A authorises for payment of remuneration. Board shall finalise the remuneration.
However, there is no clarity on the palce of profit stated in Section 314. If you are paying differential remuneration to directors, the question may arise Company utilising services of the Directors. Before paying higher amount, plese get it clarified since for contravention director may vacate the office and he should return the remuneration received by him.
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