Admission of members in sec.25 company


Khushbu (Practising Company Secretary)     09 January 2013

Khushbu
Practising Company Secretary 
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Can an employee be admitted as member in a company limited by guarantee?

If yes,than can they be paid their salary as the articles say that the income cannot be distributed among the members... 
 

avater

CA Lokesh Pokharna (CA (Ahmedabad Bhilwara Chittorgarh))     09 January 2013

CA Lokesh Pokharna
CA (Ahmedabad Bhilwara Chittorgarh) 
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first of all i think there is no problem in admitting employeee as a member, & on salary point , its not a distribution of income among members, its a compensation of his services...

 

for e.g. x employee doing job in  reliance , he also holds shares of the co, so he is member also... now  think , what will be treatment of salary which he is getting from company.. its  not a distribution its a expense for earning income..... 

 

lets see what others are saying...........

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Khushbu (Practising Company Secretary)     09 February 2013

Khushbu
Practising Company Secretary 
 2 likes  127 points

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U are right Sir...

But its a Sec 25 company..limited by guarantee..And the auditors have raised this issue that employees cannot be admitted as members in sec 25 Co....Now how can I convince them?? Please help...

 


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