place of profit in a pvt Company

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Ghanshyam Singh Jhala

Practcing Company Secretary

30 Points Posted on 08 July 2009

ABC a Pvt Company having four shareholders and all are Directors .All the dIrectors are related to each other

Director A - MD is related to Director B (WTD) getting remuneration

Director C - WTD is related to Director D (WTD)

Director A (MD) and C (WTD) are not related to each other

They all are paid remuneration which is above the limites specified under section 314 and the rules thereof .

In this case will the company be required to take CG's approval or not ?

All of them are getting remuneration only and not anything over and above remuneration . WIll they be treatred as holding place of profit .?

Replies (2)

Ghanshyam Singh Jhala

Practcing Company Secretary

30 Points Posted on 08 July 2009

Originally posted by :Ghanshyam Singh Jhala
"	ABC a Pvt Company having four shareholders and all are Directors .All the dIrectors are related to each other Director A - MD is related to Director B (WTD) getting remuneration Director C - WTD is related to Director D (WTD) Director A (MD) and C (WTD) are not related to each other They all are paid remuneration which is above the limites specified under section 314 and the rules thereof . In this case will the company be required to take CG's approval or not ? All of them are getting remuneration only and not anything over and above remuneration . WIll they be treatred as holding place of profit under section 314 of Cos ACt,1956.?	"

Ankur Garg

Company Secretary and Compliance Officer

114788 Points Posted on 08 July 2009

Hi,

Section 314 is applicable to a private company.

As per the information provided by you nobody is drawing anything over and above remuneration.

In this situation there is no applicability of section 314 till date even if all are paid remuneration which is above the limits specified under section 314 and the rules thereof.

Further provisions related to Managerial Remuneration are not applicable to a private company.

Regards