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1976 (12) TMI 115 - SUPREME COURTWhether the administrative ceiling imposed by the Board on September 28, 1967, on the remuneration payable to the managing directors by the company is ultra vires or illegal ? Whether the refusal by the Board to enhance the remuneration of the managing directors above the ceiling of Rs. 50,000 for the loss year was bad because the company was not granted adequate hearing and because the order of refusal did not state the reasons there for ? Held that:- Appeal allowed.The High Court was in error in quashing the order of the Board. According to the affidavit filed on behalf of the appellant-Board, since 1959 the said Board has been imposing a maximum administrative ceiling on the total amounts payable to a managing director. The basic principle that has been kept in view by the Board is that no individual should be paid remuneration exceeding Rs. 1,20,000 per annum or Rs. 10,000 per month. A large number of instances have also been given by the Board and it would appear there from that the maximum remuneration which has been allowed by the Board to the managing director of any company is Rs. 1,20,000.
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