Certain queries regarding terms “remuneration” and “last employment held” and other matters connected therewith clarified - Companies Law - Circular: No. C/293‑A‑(310),

Circular: No. C/293 ‑ A ‑ (310), dated 9 ‑ 6 ‑ 1976 issued by BCCI to its members. Subject:- Board s report - Companies (Particulars of Employees) Rules, 1975 ‑ Certain queries regarding terms remuneration and last employment held and other matters connected therewith clarified Many members of the Chamber have sought its advice on the information required to be disclosed in the Schedule annexed to the directors report pursuant to the Particulars of Employees Rules. The matter was discussed by the company. Law Sub‑Committee of the Chamber and in consultation with that Sub‑Committee a proforma of the Schedule to be annexed to the directors report has been drawn up and it is attached herewith for the information and guidance of members. Also attached to the form are the instructions for filling it. The attention of members is particularly invited to item No. 3 of the instructions attached to the form. According to advice received by this Chamber it is only the amounts actually received by the employee in cash that should be disclosed in the column headed Remuneration received . It is not necessary to disclose the contribution to the provident fund, gratuity, etc., which are not paid to the employee in cash. All perquisites in kind should also be ignored. In the form which has been devised by the Chamber, two additional columns giving information not required by the law have been inserted, namely, column 5 (tax deducted at source) and column 6 (net remuneration after tax). Whilst disclosure of this additional information is recommended, members may choose, in appropriate circumstances, not to give this information. If there is any doubt, members are advised to consult their own legal advisers. PROFORMA* ....................................................................................... [Name of company] SCHEDULE ANNEXED TO THE DIRECTOR S REPORT FOR THE YEAR ENDED Information required by the Companies (Particulars of Employees ) Rules, 1975 Sl. No. Name Designation Remuneration received Tax deducted at source Net remuneration after tax Nature of duties Qualifications Date of commencement of employment 1 2 3 4 5 6 7 8 9 Notes: 1. The company contributes a sum not exceeding 8-1/3 per cent of the salary to the Employees Provident Fund account and a sum not exceeding two months basic salary to the Superannuation Fund, wherever applicable. 2. The employees are entitled to leave travel allowance, gratuity, health insurance benefit, housing or rent subsidy, etc., in accordance with the company s rules. Some employees are provided with free or subsidised accommodation on a furnished/ unfurnished basis. 3. The total remuneration for employees listed above would exceed Rs. 3,000 per month after including therein the perquisite value of items (1 and 2) above calculated in accordance with the Income-tax Rules. 4. All the employees have adequate experience to discharge the responsibilities assigned to them. 5. The nature of employment is (contractual or other). INSTRUCTIONS FOR FILLING IN THE FORM 1. For the purpose of determining whether an employee should be included in this Schedule his total remuneration including perquisites (valued according to IT Rules) should be considered and not mere cash remuneration. If he is employed for the full year, the total emoluments should be Rs. 36,000 or above per annum and if he is employed for a part of the year, the emoluments must be on an average of Rs. 3,000 or above per month. 2. All names to be included in the form and should appear alphabetically, irrespective of the amount of salary or designation. 3. The amounts indicated under the head Remuneration received should be the amounts received by an employee in cash, i.e., salary, dearness allowance, bonus, commission paid in cash and house rent subsidy. Therefore, contribution to provident fund, gratuity fund, superannuation fund, etc., which are not received by the employee concerned in cash should be ignored. All perquisites in kind should also be ignored. 4. Column 5 will show the aggregate of income-tax actually deducted from salary every month. 5. The relationship of any employee with a director of the company should be indicated. 6. The information mentioned against the Notes No. 1 and 2 at the foot of the form may be suitably changed in accordance with the service rules of the company. 7. Column Nos. 3 and 7 indicating the designation and nature of duties may be combined into one, if the designations are indicative of the duties as well.