Sitting fee to NEDs

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A company can indeed pass a current date resolution to authorise the payment of sitting fees to Non-Executive Directors (NEDs) with a retrospective effect. This is permissible under Section 197 of the Companies Act 2013 and Rule 4 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014. However, the total sitting fees paid to directors must not exceed one lakh rupees.

ayushi lavania

ayushi lavania (Querist)

12 June 2023 Can a company pass a back date Resolution to pay sitting fees to its Non Executive Directors?
Please guide on the matter.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

12 June 2023 Company can pass a current date resolution authorising to pay sitting fees from earlier date.

ayushi lavania

ayushi lavania (Querist)

13 June 2023 Thanks sir for providing the solution.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

13 June 2023 You are welcome..
...

Jatin Bajaj

Jatin Bajaj (Expert)

22 July 2023 Yes, the Company can pass the resolution as on the current date for the sitting fees paid to the Non-executive Director from retrospective effect under section 197 of the Companies Act 2013 read with Rule 4 of Companies (Appointment and Remuneration of Managerial Personnel) Rules
2014
Such sitting fees payable to Directors shall not exceed one Lakh rupees

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