General Circular No.
07/2015
F. No. 1/5/2013-CL-V
Government of India
Ministry of Corporate
Affairs
5th Floor, A Wing,
Shastri Bhavan,
Dr R.P. Road, New
Delhi
Dated: 10th April,
2015
To
All Regional
Directors,
All Registrars of Companies,
All Stakeholders.
Subject: Remuneration to managerial person under Schedule
XIII of the Companies Act, 1956 – Clarification with regard to payment for
period.
Sir,
Stakeholders have drawn attention
to the provisions of Schedule XIII (sixth proviso to Para (C) of Section II of
Part II) of the Companies Act, 1956 (Earlier Act) and as clarified vide
Circular number 14/ 11/2012-CL-VII dated 16th August, 2012, which allowed
listed companies and their subsidiaries to pay remuneration, without approval
of Central Government, in excess of limits specified in para II Para (C) of
such Schedule if the managerial person met the conditions specified therein.
Stakeholders have expressed that since similar provisions are not available in
the Schedule V of the Companies Act, 2013, there is a need for a clarification
that a managerial person appointed in accordance with such provision of
Schedule XIII of Earlier Act may receive relevant remuneration for the period as
approved by the company in accordance with such provisions of Earlier Act.
2. The matter has been examined
in the light of earlier clarifications on transitional matters issued by the
Ministry. It is clarified that a managerial person referred to in para 1 above
may continue to receive remuneration for his remaining term in accordance with
terms and conditions approved by company as per relevant provisions of Schedule
XIII of earlier Act even if the part of his/her tenure falls after 1st April,
2014.
3. This issues with the approval of the competent authority.
Yours faithfully
(K.M.S. Narayanan)
Assistant Director (Policy)
23387263
Copy to: – 1. e-Governance Section and web contents Officer
to place this circular on the Ministry website
2. Guard File.
