Opinion

1.      ABC Limited is a public company engaged in the business of manufacturing and sale of paints.

2.      Dr. Patel is one of the directors of the Company but not a managing director or whole-time director. He is a relative of another director. Dr. Patel holds a Master’s degree in Chemical Engineering from London University and has special expertise in paints. He has also done PhD from Bombay University in a subject relating to paints.

3.      ABC Limited proposes to pay Dr. Patel fixed monthly fees under a consultancy contract to be entered into between the Company and Dr. Patel.

4.      Currently, Dr. Patel does not draw any remuneration from the company, except sitting fees for attending Board and Committee meetings.

5.      The Company seeks your advice as to whether it can pay the proposed remuneration to Dr. Patel, and if so, whether it would attract any of the following sections of the Act: 297, 299, 300, 301, 198, 309, 310, Schedule XIII, 314 (or any other provisions) and what compliances the Company has to make.