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SEc 314

Ameet (L) (1678 Points)

10 June 2010

WHAT IS DIFFERENCE BETWEEN SEC. 314(1) AND SEC. 314(1B) OF THE COMPANIES ACT, 1956 ?

IF THE FATHER OF DIRECTOR IS APPOINTED WITH SALARY OF RS. 15000/- THEN WHICH SECTION WILL APPLICABLE AND WHY ?

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3 Replies

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 10 June 2010

Difference

1. Section 314(1) is about post special resolution whereas Section 314(1B) is about previous special resolution.

2. In Section 314(1) the parties are Director+ relative + Associates whereas in Section 314(1B) only Relative + Associates are covered.

3. Exceptions are provided in Section 314(1) whereas there is no exception under Section 314(1B).

4. Section 314(1) is about Private company + Manager or Manager of such private company whereas Section 314(1B) is about private company only.

5. Section 314(1) ---under the company ot its subsidiary whereas Section 314(1B) ---under such company only.

Thanks

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Ameet (L) (1678 Points)
Replied 12 June 2010

but sir if the father of director is appointed in HO of Public company then limit of Rs. 10000/- will be applicable or Rs. 20000/- ? coz he may cover in Section 314(1) and / or 314 (1B) ?

Vasant Patel (Proprietor) (47 Points)
Replied 16 May 2011

WHAT IS DIFFERENCE BETWEEN SEC. 314(1) AND SEC. 314(1B) OF THE COMPANIES ACT, 1956 ?

What I understand :

Limit Rs. 10000/- or More but not more that Rs. 2,50 Lacs per Month (as recent amended limit by Govt.) in this case no prior special resolution require but Special resolution required at general meeting subsequent to the date of appointment of Relative holding place of Profit .

I have two cases in reference of enhancement of Limit by Central Government upto Rs. 2.50 Lacs. without central Government. Pl let me know which section apply 314(1) or 314 (1B) in the following case

01. In Once Company I want to appoint a Relative of Director to hold office or place of Profit at Monthly remuneration of Rs. 60000/ PM. Or Rs. 2.40 Lacs P.M. Should Company require Prior Special Resolution of Shareholders.

02. In one Company presently a relative holding place of profit at monthly remuneration of Rs. 45000/- for which earlier special resolution was passed and now Company want to revised salary upto Rs. 2.10 Lacs PM. Should Company require prior approval of shareholder prior to increase remuneration.

And please let me know under which section both case falls : under section 314 (1) or 314 (B) ?

Pl let me know how to decided case of section 314(1) or 314 (1B)

Thanks