Amendments to Schedule V of the Companies Act, 2013

The Ministry of Corporate Affairs (MCA) notifies amendments to Schedule V of the Companies Act, 2013 vide Notification dated 18.03.2021[1].

The amendments to Schedule V of the Act deals with respect to Director’s remuneration in the following manner:

  • in Section I, in the first para, after the words ― “managerial person or persons”, the words ― “or other director or directors” shall be inserted;
  • in Section II, –
  • after the words ― “managerial person”, wherever occurred, the words ― “or other director” shall be inserted;
  • for Table (A): the following shall be substituted, namely. –
Sl. No. Where the effective capital (in rupees) is Limit of yearly remuneration payable shall not exceed (in Rupees) in case of a managerial person Limit of yearly remuneration payable shall not exceed (in Rupees) in case of other director
(i) Negative or less than 5 crores. 60 lakhs 12 Lakhs
(ii) 5 crores and above but less than 100 crores. 84 lakhs 17 Lakhs
(iii) 100 crores and above but less than 250 crores. 120 lakhs 24 Lakhs
(iv) 250 crores and above. 120 lakhs plus 0.01% of the effective capital in excess of ₹ 250 crores: 24 Lakhs plus 0.01% of the effective capital in excess of ₹ 250 crores:
  • in Section III, –
  • after the words ― “managerial person”, wherever occurred, except in clause (i) of the proviso, the words ― “or other director” shall be inserted;
  • after the words ― “managerial persons”, wherever occurred, the words ― “or other directors” shall be inserted;
  • following explanation shall be inserted at the end, namely: –

“Explanation. – For the purposes of Section I, Section II and Section III, the term ― “or other director” shall mean a non-executive director or an independent director.

 

*Tanvi Singh, Editorial Assistant has put this story together.

[1] http://www.mca.gov.in/Ministry/pdf/AmendmentNotification_19032021.pdf

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