Central Government or company to fix limit with regard to remuneration
📚 Law Minded summary
When approving an appointment or a remuneration package, the Central Government or the company must have regard to a list of factors.
They include the financial position of the company, the remuneration of comparable people elsewhere, the person's professional qualifications and experience, responsibilities, past performance, and the industry standard.
It exists so a figure can be justified against something other than the Board's own goodwill.
Notwithstanding anything contained in this Chapter, 1*** a company may, while according its approval under section 196, to any appointment or to any remuneration under section 197 in respect of cases where the company has inadequate or no profits, fix the remuneration within the limits specified in this Act, at such amount or percentage of profits of the company, as it may deem fit and whi le fixing the remuneration, 1*** the company shall have regard to—
(a) the financial position of the company; (b) the remuneration or commission drawn by the individual concerned in any other capacity;
(c) the remuneration or commission drawn by him from any other company; (d) professional qualifications and experience of the individual concerned;
(e) such other matters as may be prescribed.
All sections in Chapter XIII — Appointment and Remuneration of Managerial Personnel