Section 198 specifies the overall limit on managerial remuneration (includes payment to MD/WTD/Manager and part time directors) which is 11% of the nets profits.
However the limit specified in Section 309 is in respect of payment to WTD/MD which is 10%. The 10% limit does not include payment to non-executive directors. It separately provides for payment of remuneration to directors who are neither in the whole time employment of the company nor a MD. The limit of remuneration for non-executive directors is 1% of net profits where the company has MD/WTD and 3% where the company does not have MD/WTD.
CG approval would be required in the following cases -
i) any payment exceeding 10% to MD/WTD
2) any payment exceeding 1% or 3% (as the case may be) in case of non-executive directors
3) appointment of MD / WTD not in accordance with Schedule XIII
4) in case of non-profit making companies payment of remuneration in excess of the limits specified in Schedule XIII in case of listed companies.