Can a Director's Spouse become an employee?

Others 2686 views 5 replies

suji jacob

student

32 Points Joined July 2008

Can a Director's Spouse become an employee in a private limited company? If yes whether there is any limit in the salary paid to spouse? Kindly let me know the requirements for the same.

Replies (5)

HARDIK

COMPANY SECRETARY NCFM (Corporate Gover

664 Points Joined October 2008

Read section 314.

nidhigoel89

Company Secretary

596 Points Joined December 2009

Hello!

Yes a spouse of director can be a employee in pvt co, bt at the same time ensure the compliance u/s 314 of Co. Act.

Regards

Nidhi

Love Kumar

COMPANY SECRETARY

101 Points Joined January 2011

Agree with Nidhi............

But there is some limit U/S 314.

According to section 314(1), If any relative of the director take the remuneration in whatever kind i.e. salary, commision etc exceeding Rs.10,000/- p.m.then the Only Special Resolution should be passed.

But According to the section 314(1B), If any relative of Director take remuneration exceeding Rs.20,000/-p.m. then both the Special Resolution and Central Govt. approval is required.

Regards,

Love Kumar

rvsekar2000

212 Points Joined March 2007

Hello,

Sec 314(1)- monetary limits and approvals

Remuneration up to Rs. 9,999 per month	No approval [Sec 314(1)]
Remuneration Rs.10,000-Rs. 19,999 per month	Approval by special resolution [Sec 314(1) read with Rule 10C(1) of CGGRF]
Remuneration Rs.20,000-Rs. 49,999 per month	Prior approval by special resolution [Sec 314(1B) read with Rule 10C(2) of CGGRF]
Remuneration => Rs.50,000 per month	Prior approval by special resolution + Central Govt approval [Sec 314(1B) read with Rule 10C(2) of CGGRF and Rule 3 of Director's Relatives (Office or Place of Profit) Rules 2003 ]