Managerial remuneration - Overall maximum ‑ Whether banking companies are to obtain approval of the Central Government where remuneration exceeded prescribed limits - Companies Law - Letter No. 13/7/62‑PR,

Circular : Letter No. 13/7/62 ‑ PR, dated 1 ‑ 12 ‑ 1962. Subject:- Managerial remuneration - Overall maximum ‑ Whether banking companies are to obtain approval of the Central Government where remuneration exceeded prescribed limits By virtue of the amendment effected in section 35B of the Banking Companies Act, 1949 by section 7 of the Banking Companies (Amendment) Act, 1962 (which came into force on the 16th September, 1962), the approval of the Reserve Bank of India is now necessary to the appointment of managers/managing directors by banking companies but no approval of the Central Government (in the Company Law Department) will be required in addition to approval under sections 269, 309(3), 310 and 387. In view, however, of the fact that there is no provision in the Banking Companies Act for the exclusion of the operation of section 198, in such cases, in addition to the approval of the Reserve Bank of India under the Banking Companies Act, the approval of the Central Government (in the Department of Company Law Administration) would be necessary where the remuneration exceeded the limits laid dawn in section 198.