Basis for determination of director’s remuneration ‑ Remuneration for professional services. - Companies Law - Letter : No. 3/54/87‑CL‑V,

Letter : No. 3/54/87 ‑ CL ‑ V, dated 14 ‑ 2 ‑ 1988 in response to ASSOCHAM s letter dated 16 ‑ 12 ‑ 1987. Subject:- Basis for determination of director s remuneration ‑ Remuneration for professional services. The expression of opinion by the Central Government under the proviso to section 309(1) is required for rendering services by any director, which are of a professional nature. The said proviso is also applicable for practice of the profession as an advocate, as per express provisions made thereunder. The company in which the advocate concerned is a director, should apply to the Central Government. While making an application, the company should, inter alia, state the name(s) of the company(ies) in which the advocate/director is a director. The expression of opinion will be required separately for each such director by each such company, is so desired. Section 309 deals with remuneration of directors individually and not with the firms in which such a director is a partner. The proviso to sub-section (1) refers to services rendered by any director in any professional capacity and, therefore, the question of seeking approval by the advocates firms does not arise.