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

ayushi lavania

ayushi lavania (Querist)
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13 June 2023 Thanks sir for providing the solution.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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13 June 2023 You are welcome..
...

Jatin Bajaj

Jatin Bajaj (Expert)
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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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