Hi:
XYZ, a private limited company has two directors, A and B (B is wife of A).
XYZ wants to avail consultancy services from ABC, a sole proprietory firm, owned by A and wants to pay a monthly remuneration of Rs.5 lacs to ABC as consultancy fees.
Does this transaction between 1) a private limited co. and 2) a sole proprietory concern owned by the Director of the Company, attracts the provisions of section 314(1) of the Companies Act, 1956? Pls advise.
Thanks,
i would like to refer to here,an article written by one of CCI members only.Thanks GS Rao Sir,for the same
/articles/office-or-place-of-profit--13899.asp
when i googled it this is the first link i found! :)
from my understanding, i think this does not fall under the above section as it is not a position in the company.
this would however require disclosure under AS-18 (Related Parties).
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
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