Shankar BA(Hons) (CS) (278 Points)
17 October 2012Hello CA Clubbers,
Need your advice whether a person who has been appointed as a "Whole-Time Director" can work in a
1) Private Limited (or)
2) Public Limited
Company without salary?
Is there any Section in Companies Act, 1956 or any such instances has taken place? Please provide supporting informations.
With Regards
Shankar BA(Hons)
Corporate Administrator
Smriti Dhawan
(Company Secretary )
(347 Points)
Replied 17 October 2012
A whole time Director can be appointed as non Executive Director of Public as well as Private Company, it means he is only providing some of his valuable time to the Company he is not involved in Company full time . Non Executive Director can receive sitting fees for the Board Metting he attended.
You can appoint a Whole Time Director of one Company as Non Executive Director in another Company (Public or Private)
Shankar BA(Hons)
(CS)
(278 Points)
Replied 17 October 2012
| Originally posted by : Smriti Dhawan | ||
 |
A whole time Director can be appointed as non Executive Director of Public as well as Private Company, it means he is only providing some of his valuable time to the Company he is not involved in Company full time . Non Executive Director can receive sitting fees for the Board Metting he attended. You can appoint a Whole Time Director of one Company as Non Executive Director in another Company (Public or Private) |
 |
There is a restriction on maximum salary payable to a managing director. The law is completely silent about your question.
So.....You can.
But who will work without earnings, even if yourselves is a director???
There willnot be any benefit in tax position either, to the best of my knowledge.
CA.Vinita Gupta
(Deputy Manager- Finance)
(2923 Points)
Replied 17 October 2012
By passing a Resolution the Directors may Forego the Salary, considering the Financial Position of the Company. But the Director cannot work without Salary for an indefinite period as this seems impracticable.
Shankar BA(Hons)
(CS)
(278 Points)
Replied 17 October 2012
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 17 October 2012
A whole time director is the employee of the company. And a person cannot be in a full time employment in more than one Company. It is a general rule that a Whole Time Employee cannot be a whole time employee of any other place whether he may get salary or not.
Therefore, a WTD cannot be a WTD in any other company, whether he would get salary or not.
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