The Board of Directors of “Suchitra Finance & Trading Co. Ltd.†have re-constituted the “Nomination and Remuneration Committee†at the Meeting held on 13th August, 2014 with immediate effect, consisting of three Non executive Directors of which majority are Independent Directors. Consequently, the Nomination and Remuneration Policy has been framed which was recommended by the aforesaid Committee to the Board of directors of the Company and subsequently approved and adopted by the Board in its meeting held on 22nd September, 2014.
It applies to the Board of Directors (the “Boardâ€), the Key Managerial Personnel (the “KMPâ€) and the Senior Management Personnel of the Company.
A. “Key Managerial Personnel (KMP) means:-
| (i) | Chairman |
| (ii) | Managing Director or Chief Executive Officer or the Manager. |
| (iii) | Chief Financial officer. |
| (iv) | Whole time Director |
| (v) | Company Secretary |
| (vi) | Such other officer as may be prescribed. |
B. “Senior Management Personnel†means :- To include all members other than the Directors and KMPs of the Company, who are the functional heads of the departments/divisions/branches of the Company.
1. OBJECTIVE:
The “Nomination and Remuneration Committee†and this Policy shall be in compliance with Section 178 of the Companies Act, 2013 read along with the applicable Rules thereto and Clause 49 of the Listing Agreement. The key objectives of the Committee would be:-
| a) | To guide the Board in relation to appointment and removal of Directors, Key Managerial Personnel and Senior Management. |
| b) | To evaluate the performance of the members of the Board and provide necessary report to the Board for further evaluation of the Board. |
| c) | To recommend to the Board on Remuneration payable to the Directors, Key Managerial Personnel and Senior Management. |
2. ACCOUNTABILITIES OF COMMITTEE:
2.1 Matters to be dealt with, perused and recommended to the Board by the Nomination and Remuneration Committee:-
The Committee shall:-
| a) | Reviewing the structure, size and composition (including the skills, knowledge and experience) of the Board and making recommendations on any proposed changes to the Board to complement the Company’s Corporate strategy; |
| b) | Formulate the criteria for determining qualifications, positive attributes and Independence of the director. |
| c) | Identifying persons who are qualified to become Directors and persons who may be appointed in Key Managerial and Senior Management Positions in accordance with the criteria laid down in this policy. |
| d) | Recommending to the Board on the appointment and removal of Directors, Key Managerial Personnel and Senior Management. |
| e) | Recommending to the Board on the remunerations payable to the Directors Key Managerial Personnel and Senior Management. |
| f) | Assessing the Independence of the Independent Directors. |
2.2 Policy for appointment and removal of Directors, Key Managerial Personnel and Senior Management.
| a) | The Committee shall identify and ascertain the integrity, qualification, expertise and experience of the person for appointment as Director, KMP or at Senior Management having regard to the industry experience, background and other qualities required to operate successfully. |
| b) | The Committee has the discretion to decide whether qualification, expertise and experience possessed by the person are sufficient/ satisfactory for the concerned position. |
| c) | The Committee shall scrutinize and ensure that the skills and the experience of the appointee are likely to contribute constructively to the overall effectiveness of the affairs of the Board. |
2.3 Policy for appointment of Managing Director/Whole time Director.
| a) | The Company shall appoint or re-appoint any person as its Executive Chairman, Managing Director or Executive director for a term not exceeding Five years at a time. No re-appointment shall be made earlier than one year before the expiry of the term. |
| b) | The Company shall not appoint or continue the employment of any person as the Whole time director who has attained the age of seventy years. Provided that the term of the person holding this position may be extended beyond the age of seventy years with the approval of the shareholders by passing a special resolution based on the explanatory statement annexed to the notice for such motion indicating the justification for extension of appointment beyond seventy years. |
Policy for appointment of Independent Director:-
| a) | The Committee shall ensure the compliance of the criteria laid down under Section 149 (6) of the Companies Act, 2013 & Schedule IV read with Clause 49 of the Listing Agreement, while assessing the Independence of the Independent Directors. |
| b) | An Independent Director shall hold office for a term up to five consecutive years on the Board of the Company and will be eligible for re-appointment on passing of a special resolution by the company and disclosure of such appointment in the Board’s report. |
| c) | A Independent Director shall hold office for more than two consecutive terms, but such Independent director shall be eligible for appointment after expiry of three years of ceasing to become an Independent Director. Provided that an Independent Director shall not, during the said period of three years, be appointed in or be associated with the Company in any other capacity, either directly or indirectly. However, if a person who has already served as an Independent director for 5 years or more in the Company as on October 1st, 2014 or such other date as may be determined by the Committee as per regulatory requirement; he or she shall be eligible for appointment for one more term of 5 years only. |
| d) | At the time of appointment of Independent Director it should be ensured that number of Boards on which such Independent Director serves is restricted to seven Listed Companies as an Independent Director and three Listed companies as an Independent Director in case such person is serving as a Whole time Director of a listed Company or such other number as may be prescribed under the Act. |
3. Policy relating to the Remuneration of Whole time Directors, KMP & Senior Management:-
The guiding principle is that the level and composition of remuneration shall be reasonable and sufficient to attract, retain and motivate Directors, KMP & other Senior officials. The Directors, Key Managerial Personnel ad other senior official’s salary shall be based on individual person’s responsibility and performance and in accordance with the Limits specified statutorily, if any.
3.1 Guiding Principle :
| a) | The remuneration/compensation/commission etc. to the Whole time Directors, KMP & Senior Management Personnel will be determined by the committee and recommended to the Board for their approval. The remuneration/compensation/commission etc shall be subject to the prior/post approval of the shareholders of the Company and the Central government, wherever required. |
| b) | The remuneration/commission to be paid to the Whole time Director shall be in accordance with the percentage/slabs/conditions laid down in the Articles of Association of the Company and as per provisions of the Act. |
| c) | Increments to the existing remuneration/compensation structure may be recommended by the Committee to the Board which should be within the slabs approved by the Shareholders in the case of whole- time Director. |
| d) | Where any insurance is taken by the Company on behalf of its Whole time Director, Chief Executive Officer, Chief Financial Officer, the Company Secretary and any other employees for indemnifying them against any liability, the premium paid on such insurance shall not be treated as part of remuneration payable to any such personnel. Provided that if such person is proved to be guilty, the premium paid on such insurance shall be treated as part of remuneration. |
| e) | The remuneration payable to the Directors shall be as per the Company’s policy and shall be valued as per the Income Tax Rules. |
3.2 Remuneration of Managing Director/ Whole time Director/ Manager:
| a) | Section 197(5) provides for remuneration by way of fees to a director for attending meetings of the Board of Directors and Committee Meeting or for any other purpose as may be decided by the Board. |
| b) | Section 197(1) of the Companies Act, 2013 provides for the total managerial remuneration payable by the Company to its directors, including Managing director and Whole time director, and its Manager in respect of any financial year shall not exceed Eleven percent of the Net Profits of the Company computed in the manner laid down in Section 198 in the manner as prescribed under the Act. |
| c) | The Company with the approval of the Shareholders and the Central Government may authorize the payment of remuneration exceeding eleven percent of the Net profits of the Company, subject to the provisions of Schedule V. |
| d) | The Company may with the approval of the shareholders authorize the payment of remuneration upto five percent of the Net Profits of the Company to its anyone Managing Director/ Whole time Director/ Manager and ten percent in case of more than one such official. |
| e) | If, in any financial year, the Company has no profits or its profits are inadequate, the Company shall pay remuneration to its Whole time Director in accordance with the provisions of Schedule V of the Act and if it is not ale comply with such provisions, with the previous approval of the Central Government. |
| f) | If any Whole time Director draws or receives, directly or indirectly by way of remuneration any such sums in excess of the limits prescribed under the Act or without the prior sanction of the Central Government, where required, he/she shall refund such sums to the Company and until such sums is refunded, hold it in trust for the Company. The Company shall not waive recovery of such sum refundable to it unless permitted by the Central Government. |
| g) | g) The net Profits for the purpose of the above remuneration shall be computed in the manner referred to in Section 198 of the Companies Act, 2013. |
3.3 Remuneration to the Non executive Directors:
The Non executive Directors, may receive remuneration by way of sitting fees, for attending meetings of the Board or Committee thereof. Provided that the amount of such fees shall not exceed Rs. One Lacs per meeting of the Board or Committee or such amount as may be prescribed by the Central Government from time to time.
Commission may be paid within the monetary limit approved by shareholders, subject to the limit not exceeding one percent of the Net Profits of the Company, computed as per the applicable provisions of the Act.
3.4 Remuneration of Independent Director:
The Independent Directors shall not be entitled to any stock option and may receive remuneration by way of Fees for attending Meetings of the Board or Committee thereof or for any other purpose as may be decided by the Board and Profit related commission as may be approved by the members. The sitting fees to the Independent Directors shall not be less than the sitting fees payable to other directors.
3.5 Letter of Appointment:
Each Director/KMP/Senior officials is required to sign the Letter of Appointment with the Company containing the terms of Appointment and the role assigned in the Company.
4. Evaluation:-
The Committee shall carry out evaluation of performance of every Director, KMP and Senior Management Personnel at regular Intervals (Annually).
5. Removal of Directors/ /KMP/Senior Personnels:-
Due to reasons for any disqualification mentioned in the Act or under any other applicable Act, rules and Regulations there under the Committee may recommend, to the Board with reasons to be recorded in writing removal of a Director/KMP/Senior Personnel subject to the provisions and compliance of the said Act, Rules and Regulations.
6. CONSTITUTION:
| a) | The Committee shall consist of a minimum of Three Non-Executive Directors, majority of them being Independent. |
| b) | Minimum two (2) members shall constitute a quorum for the Committee Meeting. |
| c) | Membership of the Committee shall be disclosed in the Annual Report. |
| d) | Term of the Committee shall be continued unless terminated by the Board of Directors. |
7. CHAIRMAN:
| a) | Chairperson of the Committee shall be an Independent Director. |
| b) | Chairperson of the Committee may be appointed as a member of the Committee but shall not be a Chairman of the Committee. |
| c) | In the absence of the Chairperson, the members of the Committee present at the meeting shall choose one amongst them to act as Chairperson. |
| d) | Chairperson of the Committee could be present at the Annual General Meeting or may nominate some other member to answer the shareholders queries. |
8. MEETINGS:
The Meetings of the Committee shall be held at such regular intervals as may be required. The Company Secretary of the Company shall act as Secretary of the Committee.
9. VOTINGS:
| a) | Matters arising for determination of committee Meetings shall be decided by a majority f votes of Members present and voting and any such decision shall for all purposes be deemed a decision of the Committee. |
| b) | In the case of equality of votes, the Chairman of the Meeting will have a casting vote. |
10. MINUTES OF THE COMMITTEE MEETINGS
Proceedings of all meetings must be minuted and signed by the Chairman of the Committee at the subsequent meetings. Minutes of the Committee meetings, will be tabbed at the subsequent Board and Committee Meetings.