Dear friends,
I am attaching legal opinion published in 'Focus', monthly newsletter of ICSI-WIRC for August 2010 for your information. As per the opinion given, directors should be given gratuity separately for everly term of 5 years and not for their total tenure considering reappointment. From the opinion it also follows that no gratuity will be payable in the following cases:
a) where the WTD/MD is completes his tenure of 5 years and is paid gratuity for the period. He is reappointed for another 5 years, but resigns before completion of tenure of another 5 years after reappoinemnt. In such case he will loose gratuity for his second term.
b) where the WTD/MD is appointed only for 3 years due to inadequate profit or loss and then reappointed for another term of 3 years: In this case he will not get any gratuity even though he might have completed 6 years of service.
Members may give their views on the issue.
Regards,
