Sec 198, Sec 349 ,350 Companies Act

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 May 2010 Dear All,

A public listed co wants to pay commission to its chairman 1 No. and Managing Directors 2 No.s...Whats the maximum percentage allowed as per Co's Ac? Also please let me know the additions and deductions for computing net profit as per Sec 349 and 350 of Co's Act.

Also as per Sec 198 of the Act is there any restriction that Commission paid must not exceed 2%

Thanks

Rasesh

Rasesh (Expert)
Follow

06 June 2010 The restrictions are on the total remuneration and not just the commission portion.

If there is no executive director, then the non-executive director may be paid maximum remuneration at 1% and collectively for all non-executive directors 3%.

If there are executive director, then the executive director may be paid max 5% and collective all executive directors 10%

If remuneration is paid to executive as well as non-executive directors, then total should not exceed 11%.