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Board Resolution for Increase in Director Remuneration

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CERTIFIED TRUE COPY OF THE BOARD RESOLUTION

Passed at the Meeting of the Board of Directors

________________

CIN: ________________

________________

Email: ________________

Subject: Revision of Remuneration of ________________, DIN: ________________, ________________

RESOLVED THAT the Board approves the revised remuneration of ________________ as per the entered details.

  • Basic Salary: Rs. ________________ from ________________
  • Commission: ________________% effective from FY ________________
  • HRA/Accommodation: ________________
  • Medical: ________________
  • LTA: ________________
  • PF & Gratuity: ________________
  • Vehicle & Communication: ________________
  • Other Perquisites: ________________

For and on behalf of ________________

Authorized Signatory: ________________, ________________

Place: ________________

Date: ________________

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What is a Board Resolution for Increase in Director Remuneration?

Professional Format Guide for Indian Companies

A Board Resolution for Increase in Director Remuneration is a formal corporate document that records the decision of a company's Board of Directors to revise the compensation payable to a director, managing director, or whole-time director.

Under Section 197 of the Companies Act, 2013, managerial remuneration is subject to statutory limits and must be approved through proper corporate procedures. The total remuneration payable to all directors cannot exceed eleven per cent of the net profits of the company, with specific sub-limits applicable to different categories of directors.

This resolution serves as statutory evidence of Board approval and ensures compliance with Schedule V of the Companies Act, 2013. It is essential during annual compensation reviews, performance-based increments, or restructuring of remuneration packages.

Board Resolution for Increase in Director Remuneration – Sample Format

[To be printed on Company Letterhead]

Company Name: _______________________________

CIN: _______________________________

Registered Office Address: _______________________________

Email: _______________________________

CERTIFIED TRUE COPY OF THE BOARD RESOLUTION

Passed at the Meeting of the Board of Directors held on __________ (Date) at __________ (Time) at the Registered Office of the Company.

Subject: Revision of Remuneration of Mr./Ms. __________ (Name), DIN: __________, __________ (Designation) of the Company

RESOLVED THAT pursuant to Section 197 read with Part I and Section I of Part II of Schedule V of the Companies Act, 2013, approval of the Board be and is hereby accorded for payment of revised remuneration to Mr./Ms. __________ (Name), holding DIN: __________, __________ (Designation) of the Company on the following terms and conditions:

  • Basic Salary: Rs. __________ per month with effect from __________
  • Commission: Not exceeding __________% of net profits in FY __________
  • House Rent Allowance/Accommodation: As per Company policy
  • Medical Benefits: Reimbursement as per Company rules, ceiling Rs. __________ per annum
  • Leave Travel Allowance: As per Company policy
  • Provident Fund & Gratuity: As applicable
  • Vehicle & Communication: Company car and mobile facilities for official use
  • Other Perquisites: As determined by the Board subject to Section 197 ceiling

RESOLVED FURTHER THAT in the event of absence or inadequacy of profits in any financial year, the remuneration shall not exceed limits under Section II of Part II of Schedule V.

RESOLVED FURTHER THAT the Board is authorised to vary, alter, or modify the terms of remuneration within statutory limits.

RESOLVED FURTHER THAT Mr./Ms. __________ (Name), __________ (Designation), be authorised to do all acts to give effect to this resolution including filing forms with Registrar of Companies.

For and on behalf of __________ (Company Name)

Signature: _______________________________
Name: _______________________________
Designation: _______________________________
DIN: _______________________________
Date: _______________________________
Place: _______________________________

Frequently Asked Questions

Who can be an authorised signatory for the resolution?

Usually the Chairperson, Company Secretary, or another director not interested in the resolution.

Is signature of all directors mandatory?

No. Only the Chairperson or an authorised director certifies the true copy.

Which resolution is required for increase in director remuneration?

A Board Resolution under Section 197 & Schedule V; Special Resolution if limits exceed statutory cap.

Does it need professional certification?

Not mandatory, but may be required by banks or ROC.

Can it be passed without convening a Board Meeting?

Generally passed at a Board Meeting; circulation resolution may apply for routine approvals.

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