Meaning of inadequacy of profit in schedule xiii

Hello Amit, Schedule-XIII empowers a company to pay minimum remuneration to its managerial person, even in case of inadequacy of profits or no profits. Here "inadequate profits" means profits are not sufficient to pay the remuneration. In other words the net profits before managerial remuneration are so inadequate that if remuneration is paid then it will result in loss to the company.

It is related to payment of managerial remuneration. Managerial remuneration is to be paid at a fixed amount even in cases where the company is undergoing loss or does not have sufficient profits to make such payments.