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Office of Profit

K Mohamed Ibrahim (Company Secretary) (104 Points)

19 November 2010

Can a Company appoint a person as a employee who is relative of Director.

Please advise whether Section 314 will attract. Also let me know any other provison will attract.

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5 Replies

Ajay Mishra (Company Secretary) (74337 Points)
Replied 19 November 2010

Such appointment will come under section 314 of the Companies Act, 1956.

Regards

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Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 19 November 2010

No...

Prima Facie section 314 is not applicable as long as director himself is not holding O or PoP.

Plz share the proposed remuneration of relative employee along with the remuneration drawn by director to suggest you something.

Thanx

CA Dhiraj Ramchandani (CA, M. com) (10823 Points)
Replied 19 November 2010

Hi ankur sir, m sorry, but i think, theres no suc requirement of director holding PoP, then only sec 314 applies... It applies in any case, wether director holds any place of profit or not., if his relativ is appointed for PoP.... But still, i'll refer my finals notes and reply accordingly...

CA Dhiraj Ramchandani (CA, M. com) (10823 Points)
Replied 19 November 2010

Hi mohammed, for u.., i wud say, if salary on such appointment is 50000>10000, then sec 314 (1) applies, and if its >50000, then sec 314 (1B) applies... Apart from these, sec 299 n 300 do apply for concerned director...

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 20 November 2010

Originally posted by : D н ! я σ ĵ
	Hi ankur sir, m sorry, but i think, theres no suc requirement of director holding PoP, then only sec 314 applies... It applies in any case, wether director holds any place of profit or not., if his relativ is appointed for PoP.... But still, i'll refer my finals notes and reply accordingly...