18 November 2010
Kindly help me out as regard to any formalities that needs to be complied with in an infrastructure based company pays Professional Fees to its Director who is an Architect by Profession. TDS u/s 194 J is deducted and paid. Any particular compliance / reporting required under Company Law
Any fees paid to the Directors for the services rendered by them in their professional capacity shall not be included in the remuneration of Directors provided:
1. The services rendered by the Director are of a professional nature, and
2. In the opinion of the Government the Director possess the requisite qualification for the practice of the profession.
Hence,in addition to what Ankur Sir said as per my opinion,u will have to make an application under section 309(1) to the Central Government for the purpose of obtaining a certificate from it stating that in its opinion, the Director concerned possesses the requisite qualification for the practice of the profession.
However, the provisions of section 309 of the Companies Act, 1956 are not applicable to a Private Company which is not a subsidiary of a Public Company.
CAclubindia
