Remuneration to managerial person under Schedule XIII of the Companies Act, 1956 - Clarification with regard to payment for period. - Companies Law - 07/2015

General Circular No. 07/2015 F. No. 1/5/2013-CL-V Government of India Ministry of Corporate Affairs 5 th Floor, A Wing, Shastri Bhavan, Dr R.P. Road, New Delhi Dated: 10 th April, 2015 To All Regional Directors, All Registrars of Companies, All Stakeholders. Subject: Remuneration to managerial person under Schedule XIII of the Companies Act, 1956 - Clarification with regard to payment for period. Sir, Stakeholders have drawn attention to the provisions of Schedule XIII (sixth proviso to Para (C) of Section II of Part II) of the Companies Act, 1956 (Earlier Act) and as clarified vide Circular number 14/11/2012-CL-VII dated 16 th August, 2012, which allowed listed companies and their subsidiaries to pay remuneration, without approval of Central Government, in excess of limits specified in para II Para (C) of such Schedule if the managerial person met the conditions specified therein. Stakeholders have expressed that since similar provisions are not available in the Schedule V of the Companies Act, 2013, there is a need for a clarification that a managerial person appointed in accordance with such provision of Schedule XIII of Earlier Act may receive relevant remuneration for the period as approved by the company in accordance with such provisions of Earlier Act. 2. The matter has been examined in the light of earlier clarifications on transitional matters issued by the Ministry. It is clarified that a managerial person referred to in para 1 above may continue to receive remuneration for his remaining term in accordance with terms and conditions approved by company as per relevant provisions of Schedule XIII of earlier Act even if the part of his/her tenure falls after 1 st April, 2014. 3. This issues with the approval of the competent authority. Yours faithfully (K.M.S. Narayanan) Assistant Director (Policy) 23387263 Copy to:- 1. e-Governance Section and web contents Officer to place this circular on the Ministry website 2. Guard File.