Dear Sir ,
This is extracts of shedule -V -Part -II -Section -II
" Section II.— Remuneration payable by companies having no profit or inadequate profit
without Central Government approval:
Where in any financial year during the currency of tenure of a managerial person, a
company has no profits or its profits are inadequate, it may, without Central Government
approval, pay remuneration to the managerial person not exceeding the higher of the limits
under (A) and (B) given below:—
(A):
(1) (2)
|
Where the effective capital is
|
Limit of yearly remuneration payable shall not exceed (Rupees) |
|
(i) Negative or less than 5 crores |
30 lakhs |
|
(ii) 5 crores and above but less than 100 crores
|
42 lakhs |
|
iii) 100 crores and above but less than 250 crores
|
60 lakhs |
|
(iv) 250 crores and above |
60 lakhs plus 0.01% of the effective capital in excess of Rs. 250 crores: |
Provided that the above limits shall be doubled if the resolution passed by the shareholders is a special resolution.
Explanation.—It is hereby clarified that for a period less than one year, the limits shall be pro-rated.
(B) In the case of a managerial person who was not a security holder holding securities of the company of nominal value of rupees five lakh or more or an employee or a director of the company or not related to any director or promoter at any time during the two years prior
to his appointment as a managerial person, — 2.5% of the current relevant profit:
Provided that if the resolution passed by the shareholders is a special resolution, this limit shall be doubled:
Provided further that the limits specified under this section shall apply, if—
(i) payment of remuneration is approved by a resolution passed by the Board and, in the case of a company covered under sub-section (1) of section 178 also by the Nomination and Remuneration Committee;
(ii) the company has not made any default in repayment of any of its debts (including public deposits) or debentures or interest payable thereon for a continuous period of thirty days in the preceding financial year before the date of appointment of such managerial person;
(iii) a special resolution has been passed at the general meeting of the company for payment of remuneration for a period not exceeding three years;
(iv) a statement along with a notice calling the general meeting referred to in clause (iii) is given to the shareholders containing the following information, namely:—
query (relates to the last provision containing (i) to iv)
1) It is understood that when the limits are doubled special resolution needs to be passed.
2) Query is the conditions which are prescribed --" Provided further that the limits specified under this section shall apply, if—""" this is applicable when ???----- when limits are doubled and special resolutions are paased ?????( continue to earlier provision ?) OR
3) this conditions of special resolutions are aplicable when we follow the schedule -V irrespective of doubling the limits ????
4)is that mean when limits are not doubled we can pass ordinary resolutions and dont have to follow last provision containing (1) to (iv) statement in the notice etc
5) there is colon (:) after the proviso " Provided that if the resolution passed by the shareholders is a special resolution, this limit shall be doubled:--that means any thing after this is continuation of this -
6) but the word " in this section written in the provision "Provided further that the limits specified under this section shall apply, if—" is making this applicable for whole section (ii) of part ii .
pls suggest --when the ordinary resolution is reqd and when the specail resolution is reqd and when condition (i) to (iv) is to be followd ??
reggds
CAclubindia
