Managerial remuneration- unlisted co's

Dear Friends,

Kindly clarify

Whether as per MCA circular dtd 08/02/2011 relating to Managerial remuneration, unlisted companies are now free to pay any amount of remuneration to its directors without  any Central Governement approval.?

Thanks

Varsha

Replies (2)

Accordingly, Schedule XIII of the Companies Act 1956 is being amended to provide that unlisted companies (which are not subsidiaries of listed companies) shall not require Government approval for managerial remuneration in cases where they have no profits/ inadequate profits, provided they meet the other conditions stipulated in the Schedule.

earlier there was the restriction on payment of managerial remuneartion is case of inadqueate profits/no profits on the unlisted companies that they have to take the permission from the central government, now such restriction has been removed.

however the other provision of schedule xiii are required to be followed.

 

Does it mean that Unlisted companies proposing to pay more than 198 limits will fall under Inadequate Profit category of Schedule XIII.?

 

 

 

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