A public Limited Company has appointed Mr. X as Managing Director and fixed his remuneration under SEction I of Part II of Schedule XIII. The Company has agreed to pay 2% of net profit as salary. However, at the end of financial year, the company has incurred loss and "as net profit was zero or negative", Company did not give any remuneration to him.
My question is
"Whether in case of no profit or inadequate profit, the Company is not bound to follow SEction II of Part II of Schedule XIII."
and if the Company is not apying any remuneration, then the company is not required to take approval of Central Government.?
CAclubindia
