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TMI BlogSCHEDULE V -See sections 196 and 197X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (ix) the Income-tax Act, 1961 (43 of 1961); (x) the Customs Act, 1962 (52 of 1962); (xi) the Competition Act, 2002 (12 of 2003); (xii) the Foreign Exchange Management Act, 1999 (42 of 1999); (xiii) the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986); (xiv) the Securities and Exchange Board of India Act, 1992 (15 of 1992); (xv) the Foreign Trade (Development and Regulation) Act, 1922 (22 of 1922); (xvi) the Prevention of Money-Laundering Act, 2002 (15 of 2003); 4[(xvii) the Insolvency and Bankruptcy Code, 2016 (31 of 2016) (xviii) the Goods and Services Tax Act, 2017 (12 of 2017) (xix) the Fugitive Economic Offenders Act, 2018 (17 of 2018)] (b) he had not been detained for any period under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (52 of 1974): Provided that where the Central Government has given its approval to the appointment of a person convicted or detained under sub-paragraph (a) or sub-paragraph (b), as the case may be, no further approval of the Central Government shall be necessary for the subsequent appointment of that person if he had not been so convicted or detained subsequent to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... less than 100 crores. 84 lakhs 17 Lakhs (iii) 100 crores and above but less than 250 crores. 120 lakhs 24 Lakhs (iv) 250 crores and above. 120 lakhs plus 0.01% of the effective capital in excess of ₹ 250 crores: 24 Lakhs plus 0.01% of the effective capital in excess of ₹ 250 crores:] 8[Provided that the remuneration in excess of above limits may be paid] ]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 Case of a managerial person 18[or other director] who is functioning in a professional capacity, 9[remuneration as per item (A) may be paid], if such managerial person 18[or other director] is not having any interest in the capital of the company or its holding company or any of its Subsidiaries directly or indirectly or through any other statutory structures and not having any direct or indirect interest or related to the directors or promoters of the company or its holding company or any of its subsidiaries at any time during the last two years before or on or after the date of appointment and possesses graduate level qualif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ils would be with respect to the Country of his origin) (7) Pecuniary relationship directly or indirectly with the company, or relationship with the managerial personnel, if any. III. Other information: (1) Reasons of loss or inadequate profits (2) Steps taken or proposed to be taken for improvement (3) Expected increase in productivity and profits in measurable terms IV. Disclosures The following disclosures shall be mentioned in the Board of Director's report under the heading "Corporate Governance", if any, attached to the financial statement: (i) all elements of remuneration package such as salary, benefits, bonuses, stock options, pension, etc., of all the directors; (ii) details of fixed component and performance linked incentives along with the performance Criteria; (iii) service contracts, notice period, severance fees; and (iv) stock option details, if any, and whether the same has been issued at a discount as well as the period over which accrued and over which exercisable. Explanation: For the purposes of Section Il of this part, "Statutory Structure" means any entity which is entitled to hold shares in any company formed under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he quantum of remuneration and such certificate is filed along with the return as prescribed under sub-section (4) of section 196. (iii) the auditor or Company Secretary or where the company has not appointed a secretary, a secretary in whole-time practice certifies that there is no default on payments to any creditors, and all dues to deposit holders are being settled on time. 15[******] 22[Explanation.- For the purposes of Section I, Section II and Section III, the term "or other director" shall mean a non-executive director or an independent director.] SECTION IV - Perquisites not included in managerial remuneration 1. A managerial person shall be eligible for the following perquisites which shall not be included in the computation of the ceiling on remuneration specified in Section II and Section III:- (a) contribution to provident fund, superannuation fund or annuity fund to the extent these either singly or put together are not taxable under the Income-tax Act, 1961 (43 of 1961), (b) gratuity payable at a rate not exceeding half a month's salary for each completed year of service, and (c) encashment of leave at the end of the tenure. 2. In addition to the per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dependent children and dependent parents of the managerial person. Explanation IV.- The Nomination and Remuneration Committee while approving the remuneration under Section II or Section III, shall- (a) take into account, financial position of the company, trend in the industry, appointee's qualification, experience, past performance, past remuneration, etc.; (b) be in a position to bring about objectivity in determining the remuneration package while striking a balance between the interest of the company and the shareholders. Explanation V.-For the purposes of this Schedule, "negative effective capital" means the effective capital which is calculated in accordance with the provisions contained in Explanation I of this Part is less than zero. Explanation VI.-For the purposes of this Schedule:- 16[******] (B) "Remuneration" means remuneration as defined in clause 78 of section 2 and includes reimbursement of any direct taxes to the managerial person. SECTION V- Remuneration payable to a managerial person in two companies Subject to the provisions of sections I to IV, a managerial person shall draw remuneration from one or both companies, provid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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:- I. General Information: (1) Nature of industry (2) Date or expecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... V dated 12-09-2018 before it was read as "(d) where he is a managerial person in more than one company, he draws remuneration from one or more companies subject to the ceiling provided in section V of Part II;" 6. Omitted vide Notification File Number 1/5/2013-CL-V dated 12-09-2018 before it was read as "without Central Government approval" 7. Omitted vide Notification File Number 1/5/2013-CL-V dated 12-09-2018 before it was read as "without Central Government approval" 8. Substituted vide Notification File Number 1/5/2013-CL-V dated 12-09-2018 before it was read as "Provided that the above limits shall be doubled" 9. Substituted vide Notification File Number 1/5/2013-CL-V dated 12-09-2018 before it was read as "no approval of Central Government is required" 10. Substituted vide Notification File Number 1/5/2013-CL-V dated 12-09-2018 before it was read as "(ii) the company has nol committed 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 manager ..... X X X X Extracts X X X X X X X X Extracts X X X X
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