Category of director in form 32
This query is : Resolved
08 November 2013
In a pvt co, in order to be called a professional director, is it necessary to possess any professional qualification?
09 November 2013
Better you select 'whole time director'. This would cover everything without any qualification and certificates.
contact@vkbajaj.co.in
contact@vkbajaj.co.in
10 November 2013
Hi
Yes, in private companies, you have an option, either promoter or professional. If you want to give shares to such director or he is directly or indirectly interested with such company, then it will be better to appoint him as promoter.
For appointing him as professional director, then he should hold some professional qualification.
Yes, in private companies, you have an option, either promoter or professional. If you want to give shares to such director or he is directly or indirectly interested with such company, then it will be better to appoint him as promoter.
For appointing him as professional director, then he should hold some professional qualification.
10 November 2013
@Mr Ajay Mishra!
Recently we have an issue over the remuneration of a promoter director (earlier he was holding shares and now only one share)as per section 314(1A). This whole time director is also a Professional.
But Form 18 concerning to this director was e-filed as Director.
Finally there were two options either to reduce his remuneration or change his designation from Director to Whole Time Director. First option was adopted as it was practical.
Now can we e-file his professional qualification to take back reduced salary so that section 314(1A) does not stand on way?
Keeping in view this experience I answered to e-file Form 18 as Whole Time Director.
Recently we have an issue over the remuneration of a promoter director (earlier he was holding shares and now only one share)as per section 314(1A). This whole time director is also a Professional.
But Form 18 concerning to this director was e-filed as Director.
Finally there were two options either to reduce his remuneration or change his designation from Director to Whole Time Director. First option was adopted as it was practical.
Now can we e-file his professional qualification to take back reduced salary so that section 314(1A) does not stand on way?
Keeping in view this experience I answered to e-file Form 18 as Whole Time Director.
10 November 2013
Dear Bajaj Sir...
The provision of remuneration to director is govern by their articles and Companies Act, 1956 does not impose any restriction thereon. He is a director and geeting remuneration from company as director remuneration.
Now come to the provision of section 314:
First you confirm that at the time of appointment you have decided to pay him as director remuneration or remuneration is being paid for the office of place of profit.
Now in this regard no need to file Form-18 to ROC, because it is govern got change in the registered office of the company.
The provision of remuneration to director is govern by their articles and Companies Act, 1956 does not impose any restriction thereon. He is a director and geeting remuneration from company as director remuneration.
Now come to the provision of section 314:
First you confirm that at the time of appointment you have decided to pay him as director remuneration or remuneration is being paid for the office of place of profit.
Now in this regard no need to file Form-18 to ROC, because it is govern got change in the registered office of the company.
10 November 2013
Office of managing or whole-time director or manager is not an office or place of profit:
Section 314(1)(b) state that no partner or relative of a director, no firm in which a director, manager or a relative of such director, is a partner, no private company of which such director is a director or member, and no director or manager of such a private company, shall hold any office or place of profit carrying a total monthly remuneration of such sum as may be prescribed, except that of managing director or manager, banker or trustee for the holders of debentures of the company.
As per section 314(1B) certain persons as given below cannot hold office or place of profit carrying the remuneration of Rs. 2,50,000 p.m. or more in the company, unless special resolution to that effect has been passed in the general meeting of the company and prior approval of the Central Government has been obtained:—
1. any partner of the firm in which director of the company is also a partner;
2. any relative of a director of the company;
3. any firm in which a director or his relative or both are partner;
4. any private company in which director of the company is holding office of director or member;
5. any director/manager of a private company in which director of the company is holding office of director or member.
Provision of section 314(1B) shall not apply to any appointment of firm of solicitors/advocates, if they are appointed to give advise and are consulted by the company in its work on case to case basis. Therefore, any remuneration or fee received by a professional director as advocates/solicitors for appearing in a Court of Law or Company Law Board/Tribunal in pleading on behalf of the company will not come under the provisions of the section as mentioned above.
Office of managing or whole-time director or manager is not an office or place of profit:
Section 314(1)(b) state that no partner or relative of a director, no firm in which a director, manager or a relative of such director, is a partner, no private company of which such director is a director or member, and no director or manager of such a private company, shall hold any office or place of profit carrying a total monthly remuneration of such sum as may be prescribed, except that of managing director or manager, banker or trustee for the holders of debentures of the company.
As per section 314(1B) certain persons as given below cannot hold office or place of profit carrying the remuneration of Rs. 2,50,000 p.m. or more in the company, unless special resolution to that effect has been passed in the general meeting of the company and prior approval of the Central Government has been obtained:—
1. any partner of the firm in which director of the company is also a partner;
2. any relative of a director of the company;
3. any firm in which a director or his relative or both are partner;
4. any private company in which director of the company is holding office of director or member;
5. any director/manager of a private company in which director of the company is holding office of director or member.
Provision of section 314(1B) shall not apply to any appointment of firm of solicitors/advocates, if they are appointed to give advise and are consulted by the company in its work on case to case basis. Therefore, any remuneration or fee received by a professional director as advocates/solicitors for appearing in a Court of Law or Company Law Board/Tribunal in pleading on behalf of the company will not come under the provisions of the section as mentioned above.
11 November 2013
@ Mr Mishra!
Thanks for your guidance and appreciate for the valuable time.
I am sorry for one mistake (perhaps typing) that I mentioned form 18 instead of Form 32.
Once again I give you history:
A promoter Director (as well as first shareholder) is a qualified professional and remunerated himself as per his merit/qualification and were innocent about section 314(1A. Every year salaries were appreciated but at normal rate for his skills. Recently they came to know about the limit of Rs. 50000 u/s 314(1A). Remuneration was reduced.
Now is there any remedy to make it above 50000 by e-filing professional qualification certificate or quoting the fair value in open market for the services rendered by Director.
Your valued advice shall be consumed positively.
Thanks for your guidance and appreciate for the valuable time.
I am sorry for one mistake (perhaps typing) that I mentioned form 18 instead of Form 32.
Once again I give you history:
A promoter Director (as well as first shareholder) is a qualified professional and remunerated himself as per his merit/qualification and were innocent about section 314(1A. Every year salaries were appreciated but at normal rate for his skills. Recently they came to know about the limit of Rs. 50000 u/s 314(1A). Remuneration was reduced.
Now is there any remedy to make it above 50000 by e-filing professional qualification certificate or quoting the fair value in open market for the services rendered by Director.
Your valued advice shall be consumed positively.
11 November 2013
Dear Sir,
Section 314 will apply to director when you paid him remuneration in addition to director remuneration.
So confirm the division of remuneration:
You are paying him as director remuneration or paying him under office or place of profit, because both remuneration provision are different.
Section 314 will apply to director when you paid him remuneration in addition to director remuneration.
So confirm the division of remuneration:
You are paying him as director remuneration or paying him under office or place of profit, because both remuneration provision are different.
11 November 2013
Sir! Ajay Ji
As Director Remuneration likewise Salaries.
As Director Remuneration likewise Salaries.
11 November 2013
If you are paying him as director remuneration then provision of section 314 is not applicable.
Because director remuneration is governed by section 198 and section 309 of the companies Act, 1956.
If you take services from such director as a professional nature and then you are paying for it, then provision of section 314 is applicable.
Because director remuneration is governed by section 198 and section 309 of the companies Act, 1956.
If you take services from such director as a professional nature and then you are paying for it, then provision of section 314 is applicable.
11 November 2013
Thanks Sir
It means we are on right path as 314 section is being followed.
Great thanks Sir!!!
It means we are on right path as 314 section is being followed.
Great thanks Sir!!!
11 November 2013
My Pleasure Sir....
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