ROC Filing for board resolution

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Ravi lalchand Chhatpar

Ravi lalchand Chhatpar (Querist)
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15 May 2024 do we have to file board resolution where private limited company's director salary is fixed with ROC

Asha Kanta Sharma

Asha Kanta Sharma

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11 July 2024 Yes, as per the Companies Act, 2013 and related rules, a private limited company is required to file certain resolutions and agreements with the Registrar of Companies (ROC). Fixation of director's salary typically involves passing a resolution by the board of directors, and in some cases, by the shareholders. Here’s a breakdown of when and what needs to be filed with the ROC:

1. **Board Resolution for Director's Salary:**
- When the board of directors of a private limited company decides on the salary or remuneration of its directors, it is customary to pass a board resolution.
- This resolution should clearly specify the details of the salary, including the amount, components (like basic salary, allowances, perks), effective date, and any other terms and conditions.
- The board resolution is an internal document of the company and does not necessarily need to be filed with the ROC. However, it must be maintained in the company's records as part of corporate governance and compliance.

2. **Form DIR-12 - Disclosure of Director's Remuneration:**
- If the director's remuneration exceeds the limits specified under Section 197 of the Companies Act, 2013, the company is required to file Form DIR-12 with the ROC.
- Form DIR-12 includes details of the remuneration paid to directors, including salaries, perquisites, commissions, etc. It is filed annually within 60 days from the date of the annual general meeting (AGM) or the due date for holding the AGM, whichever is earlier.

3. **Board Resolution for Specific Matters:**
- Apart from salary fixation, certain decisions or actions of the board require specific resolutions to be filed with the ROC. Examples include:
- Appointment or removal of directors
- Approvals for related party transactions
- Opening or closing of bank accounts
- Borrowing of funds, etc.

4. **Board Meetings and Minutes:**
- Minutes of all board meetings where significant decisions are made, including salary fixation, should be maintained by the company. These minutes serve as a record of corporate decision-making and are crucial for compliance and governance.

In summary, while the board resolution for fixing director's salary itself does not need to be filed with the ROC, the details of the director's remuneration exceeding prescribed limits should be disclosed annually in Form DIR-12. It's essential to maintain accurate records of all board resolutions and minutes as part of corporate compliance and governance practices. For specific legal and compliance advice tailored to your company's situation, consulting with a company secretary or legal advisor is recommended.