Director remuneration ceiling for pvt. limited company

Page no : 2

gayatri (JOB) (39 Points)
Replied 06 January 2016

MAY I KNOW THE CORRECT APPLICABILITY OF INCREASE IN REMUNERATION OF MD, WTD AND DIRECTOR IN CASE OF PRIVATE LIMITED COMPANIES UNDER THE COMPANIES ACT 2013 , IS SCHV , 197 CEILING LIMITS ARE APPLICABLE ?

Rahul Mishra (Accounts Head) (37 Points)
Replied 26 January 2016

There is no cieling on Directors remuneration in private limited companies, except certain private limited companies having share capital or turnover of more than prescribed limit. Private Ltd which are subsidiary of a public or government company dont enjoy this exemption.

ACS Parul Rawat (Entrepreneur | Corporate Law Advisor | Lawyer in Making | AIR-8) (218 Points)
Replied 02 March 2016

Under Section 197 of Companies Act, 2013 Remuneration of two types of Directors are covered Executive directors and Non-Executive directors. Is there any such distinction in Pvt Companies.for payment of Remuneration to Executive and Non-Executive director?

I mean if a Pvt. Co. has Manager and a director can they receive equal remuneration (Subject to the AOA)?

Siddharth Goel (Chartered Accountant) (3026 Points)
Replied 04 July 2018

Originally posted by : ACS Parul Rawat
	Under Section 197 of Companies Act, 2013 Remuneration of two types of Directors are covered Executive directors and Non-Executive directors. Is there any such distinction in Pvt Companies.for payment of Remuneration to Executive and Non-Executive director? I mean if a Pvt. Co. has Manager and a director can they receive equal remuneration (Subject to the AOA)?

As per Companies Act 2013, a maximum ceiling of remuneration is exempted for Private limited company, therefore a private company can pay any amount to the managers, directors subject to the restrictions and terms mentioned in the Articles of Asssociation.

So, to answer your question, Yes, the Manager and a director can receive equal remuneration which shall be subject to AOA.