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Directors Remuneration

Others 589 views 2 replies

P.K. SHAW

CS & Compliance Officer and CA Final

59 Points Joined April 2008

Dear All,

A Company under BIFR apponited a new Director who is relative of promoters and paying him remuneration of Rs. 2 lacs P.M. The Company has not started commercial production and have no profit. the company has accumulated loss of Rs. 50 crores.

Can the Company pay remuneration of Rs. 2 lacs p.m., if yes how?

what are the other sections need to be complied.

Replies (2)

Chitrank Jain

Senior Manager - Group Internal Audit

146 Points Joined July 2008

In this case since company is not making profit you will have resort to Schedule XIII of the companies act, which stipulates the remuneration that can be paid ( depending on the the paid up capital of the company)