BHAVINI SHAH (Company Secretary) (193 Points)
27 August 2012Dear All,
A private company engages an advocate for its legal services on a continuous basis.
The advocate is a relative of a director of the Company.
Kindly advice if section 297 of the companies act applies to such a legal service?
Also, if yes, then is the company needed to comply with the said section for each bill that the advocate raises for different financial years?
Giridhar S Karandikar
(Team Lead)
(7548 Points)
Replied 28 August 2012
Section 297 is applicable only if the director or his relative is interested in the contract put before company. IN the present case the advocate is only provided services in his ordinary course & is not interested in any of the contracts put before the co. SO the provison of section 297 are N/A.
BHAVINI SHAH
(Company Secretary)
(193 Points)
Replied 28 August 2012
But the advocate being a relative of a director of the comapny, doesnt he automatically become interested in the contract?
I want to understand this situation asd per the provisions of law.
CAclubindia
