Section 198 provides that the total managerial remuneration payable by a public company or a private company which is a subsidiary of a public company
to its directors or manager in respect of any financial year must not exceed 11 per cent of the net profits of that company for that financial year. In
computing the aforesaid ceiling of 11 per cent, Section 198 (4) says the fees payable to directors for attending Board meetings shall not be included.
.Section 309, another Section dealing with managerial remuneration, provides that subject .to the general provisions of Section 198, the remuneration be
determined by the Articles, or by a resolution or, if the Articles so require, by a special resolution, passed by the company in general meeting. The
remuneration so payable shall be inclusive of the remuneration payable for services rendered by a director in any other capacity except where
(a) the services are of a professional nature, and
(b) in the opinion of the Central Government, the director possesses the requisite qualifications for the practice of the profession.
A director who is neither in the whole-time employment of the company nor a managing
director may be paid remuneration:
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