Rent to one of directors wife
This query is : Resolved
23 January 2010
We are public limited company and paying Office Rent to wife of Managing Director.
Is there any imlicaiton under any law.
what are the compliance we have to comply under companies act like resolution etc if any
Is there any imlicaiton under any law.
what are the compliance we have to comply under companies act like resolution etc if any
23 January 2010
yes it will be dealt u/s 297 and 301 of companies act.
this contract should be approved in board meeting u/s 297 and related director will not participate in voing u/s 300.
u/s 297 if service is more than Rs. 5000/- then it should be approved by board.
u/s 301 you have to enter this contract in register maintained u/s 301.
this contract should be approved in board meeting u/s 297 and related director will not participate in voing u/s 300.
u/s 297 if service is more than Rs. 5000/- then it should be approved by board.
u/s 301 you have to enter this contract in register maintained u/s 301.
28 January 2010
Sorry, I do not agree as Sec 297 will apply only in case of sale or purchase of goods/services. AS rent pertains to immovable property Section 297 will not be applicable.
Section 314 will apply as director is holding place of profit.
Compliance differs on amt paid as rent which will be:
- less than 10000 per month than board resolution to be passed
- if 10000 or more but less than 20000 per month than special resolution
- if >= 20000 than special resolution & CG approval
Section 314 will apply as director is holding place of profit.
Compliance differs on amt paid as rent which will be:
- less than 10000 per month than board resolution to be passed
- if 10000 or more but less than 20000 per month than special resolution
- if >= 20000 than special resolution & CG approval
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