Is it mandatory to pay sitting fees to non-independent non- executive directors??
Can sitting fees may vary from director to director??
please give section referrence too.
6 Replies
Jatin Bajaj
(CS)
(2930 Points)
Replied 28 March 2018
As per the provisions of Section 197(5) of the Companies Act 2013, read with rule 4 of appointment and remuneration of mangerial personnel rules, a Company may pay sitting fees to executive or non executive director. But maximum fees payable to such director shall not exceed Rupees one lakh per meeting.
However sitting fees paid for attending Board meeting to independent Director shall not be less than the other directors
Richa Shaw
(45 Points)
Replied 28 March 2018
A company has two non-executive directors who are NOT Independent directors.
what if we not pay sitting fees to ONE of those two non-executive directors(who is NOT independent director)?
Can we do that if agreement permits?? or act bars it somewhere?
what if we not pay sitting fees to ONE of those two non-executive directors(who is NOT independent director)?
Can we do that if agreement permits?? or act bars it somewhere?
Jatin Bajaj
(CS)
(2930 Points)
Replied 28 March 2018
The word used in section 197 is May. So I is not mandatory. It depends upon the mutual understanding and decision of the Company and director.
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