Can Salary be paid to a Non-Executive Director of a Private Limited Company without declaring him as a Wholetime Director? Would it make him a Director occupying a place of profit under section 314 of the Companies Act in such case? Would such a Director discharging the function of the Marketing Consultant to the Company be still held a non-Executive Director and not be considered as a Whole time Director?
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Salary to a Non-Executive Director of a Private Limited Co.
Replies (3)
Remuneration can be paid to a non-executive director without him being a whole time director, however subject to the following (Section 309 of Companies Act, 1956):
1) monthly, quarterly or annual payment only with the approval of the CG
2) commission not exceeding 1% (if the company has MD/WTD/Manager) or 3% ( in any other case) of the net profits subject to passing special resolution in GM Any commission exceeding these limits can be paid subject to approval by CG.
A Director holding the position of marketing consultant, if not appointed whole time will be a non-executive director and his office of marketing consultant will be treated Office of Profit u/s.314.
Hi,
The query is with regard to a Private Limited Company, hence the provisions of Section 269 read with Schedule XIII and section 309 and 310 shall not be applicable, provided the said private limited company is not a subsidiary of Public Company.
Further, in my view, the provisions of Section 314 may attract as the director is discharging the function of Marketing Consultant.
Best Regards
CS Ashwini Kumar
A person is an employee of partnership firm.Can he be appointed as Executive director of the Pvt Co.?Will Sec 314 will get attract
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