Appointemtn of director

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

26 August 2013 In private company, if a director's relative is to be appointed as director with remuneration.
* What procedure is required to be followed ?

Ajay Mishra

Ajay Mishra (Expert)
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26 August 2013 Hi

It will depend that, whether the director is taking remuneration under section 314 of the Companies Act, 1956. Section 314 applies only when a director himself covered under section 314 of the Companies Act, 1956.

As per section 314(3), a director is said to be holding 'Office or Place of Profit' in a company, if he obtains from the company in addition to the remuneration to which he is entitled as a director any salary, fees, commission or any other perquisites while holding the office of a director.
An individual other than a director or any firm, private company or body corporate is said to be holding office or place of profit in a company, if they obtain from the company, by way of remuneration, any salary, fees, commission or any other perquisites while holding the office or place of profit in the company.

Section 314 is applicable to both public and private companies.

Querist : Anonymous

Querist : Anonymous (Querist)

05 September 2013 Thanks Sir.

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