Schedule v

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Querist : Anonymous

Querist : Anonymous (Querist)

18 August 2014 1. Is Schedule V applicable for MD of Private Companies also.

2. Limitation that a MD cant be appointed in More two companies at a time. is that applicable for private companies also.

Please reply

Ankur Garg

Ankur Garg (Expert)
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18 August 2014 Appointment of MD is not mandatory for a Private Company so there is no point of applicability of schedule V in case of a private Company.

Thanks

Querist : Anonymous

Querist : Anonymous (Querist)

19 August 2014 sir in our case there is MD in group of private Companies .

Section 196 becomes applicable to it which is applicable to both whether its private or Public company. and Its Sub Section 4 states that subject to provisions of section 197 and Schedule V, MD, WTD or Manager shall be appointed.

Then what will be solution in respect of my above two queries .

1. Is Schedule V applicable for MD of Private Companies also. 2. Limitation that a MD cant be appointed in More two companies at a time. is that applicable for private companies also. Please reply....

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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23 July 2025 Good questions! Here’s a clear explanation regarding **Schedule V** and appointment of **Managing Directors (MDs)** in private companies:

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### 1. **Is Schedule V applicable for MD of Private Companies?**

* **Appointment of MD in a private company is not mandatory.**
* However, if a **private company appoints an MD**, **Section 196** of the Companies Act, 2013 applies irrespective of the company being private or public.
* Schedule V relates to **remuneration rules for managerial personnel** including MD, WTD, Manager.
* So, **if a private company has an MD and decides to pay remuneration**, then **Schedule V applies to that private company** for the purpose of remuneration limits and conditions.
* In summary:

* **Schedule V applies to remuneration of MD in private companies** if such appointment and payment exist.
* If there is no MD, Schedule V has no application.

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### 2. **Is the limitation on appointment of MD in more than two companies at a time applicable to private companies?**

* Section 196(3) states that a person shall not be appointed or re-appointed as MD or manager in more than **two companies** at the same time.
* The term “company” includes both **private and public companies** unless exempted.
* So, **this limitation applies to private companies as well**.
* This means the same person cannot simultaneously hold the position of MD (or manager) in more than two companies, whether private or public.

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### Summary:

| Query | Answer |
| ------------------------------------------------------------------- | --------------------------------------------------------------------------------- |
| Is Schedule V applicable for MD of private companies? | Yes, if MD is appointed and remuneration paid, Schedule V applies. Otherwise, no. |
| Does the limit of max 2 MD appointments apply to private companies? | Yes, it applies to both private and public companies. |

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If your group has MDs in multiple private companies, the limit of **max two MD posts** per person applies across those companies.

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If you want, I can also share the exact text of **Section 196(3)** and the relevant part of **Schedule V** for clarity. Would you like that?

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