Subs. by Notification No. S.O. 4822(E), for “Provided that the above limits shall be doubled” (w.e.f. 12-9-20… — THE COMPANIES ACT, 2013

Subs. by Notification No. S.O. 4822(E), for “Provided that the above limits shall be doubled” (w.e.f. 12-9-2018).

5. Subs. by Notification No. S.O. 4822(E), for “Provided that the above limits shall be doubled” (w.e.f. 12-9-2018). 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 who is functioning in a professional capacity, 1 [remuneration as per item (A) may be paid], if such managerial person 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 qualification with expertise and specialised knowledge in the field in which the company operates: Provided that any employee of a company holding shares of the company not exceeding 0.5% of its paid up share capital under any scheme formulated for allotment of shares to such employees including Employees Stock Option Plan or by way of qualification shall be deemed to be a person not having any interest in the capital of the company: Provided further that the limits specified under items (A) and (B) of 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) 2 [the company has not committed any default in payment of dues to any bank or public financial institution or non -convertible debenture holders or any other secured creditor, and in case of default, the prior approval of the bank or public financial institution concerned or the non-convertible debenture holders or other secured creditor, as the case may be, shall be obtained by the company before obtaining the approval in the general meeting;] (iii) an ordinary resolution or a special resolution, as the case may be, has been passed for payment of remuneration as per 3*** item (A) or a special resolution has been passed for payment of remuneration as per item (B), at the general meeting of the company 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:- General information: Nature of industry Date or expected date of commencement of commercial production In case of new companies, expected date of commencement of activities as per project approved by financial institutions appearing in the prospectus Financial performance based on given indicators (5) Foreign investments or collaborations, if any. II. Information about the appointee: Background details Past remuneration Recognition or awards Job profile and his suitability Remuneration proposed (6) Comparative remuneration profile with respect to industry, size of the company, profile of the position and person (in case of expatriates the relevant details 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.

Section 5