Hi
We want to make payment of remuneration to our independent directors by way of commission not exceeding 1% of net profits. Relating to this I have few queries, if you can please share your ideas.
1. Our financial year is Jan - Dec. We want to make payment of remuneration each quarter after calculating 1%, from the net profit of each quarter. - Is this permissible. Overall limit will be 1% of NP, but we propose to pay every quarter based on quarterly profits, without attracting sec.309(4)(a).
2. We will take approval of shareholders in May. Can we make payment to directors in April which will be approved by members in AGM in May.
3. In case the company goes into huge losses in the last quarter and the remuneration already paid is more than 1% of annual profits, what would be the implication?
If anybody has resolution covering these points, it would be very helpful.
Regards
Vijayamahantesh
CAclubindia
