Business Ethics and Corporate Governance, Second Edition

PROHIBITION OF TAX-FREE PAYMENTS

According to Section 200 of the Companies Act:

1. No company shall pay to an officer or employee thereof, whether in his capacity as such or otherwise, remuneration free of tax, or otherwise calculated by reference to, or varying with, tax payable by him, or the rate or standard rate of such tax, or the amount thereof.

   In this instance, the expression ‘tax’ comprises any kind of income tax including super tax, if any.

2. By virtue of a provision in force immediately before the commencement of this Act, whether contained in the company’s or in any contract made with the company, or in a resolution passed by the company in general meeting or by the company’s board of directors, an officer or employee of the company holding ...