The Board of Directors of the company presents the following financial data extracted from the company's financial statements as at 31st March, 2024 : Particulars ₹ (Cr.) Authorised equity share capital 240 Paid-up equit

Section 197 read with Section 198 and Schedule V of the Companies Act, 2013 deals with the provisions related to managerial remuneration. As per Section 197 (3) of the Act , notwithstanding anything contained in sub-sections197 (1) and 197(2), but subject to the provisions of Schedule V, if in any financial year, a company has no profits or its profits are inadequate, the company shall not pay to its directors, including any managing or whole time director or manager, or any other non-executive director, including an independent director by way of remuneration any sum exclusive of any fees payable to directors under 197 (5) hereunder except in accordance with the provisions of Schedule V whereunder slab- wise limit on managerial remuneration on the basis of the effective capital of the company has been stipulated. Computation of Effective Capital of Company for determining managerial remuneration: Particulars Rs. (Cr.) Paid-up equity share capital 40 Debenture redemption reserve 40 Securities Premium Account 80 Revaluation Reserve (excluded) --- Profit and Loss (Loss) (40) Effective Capital 120 As per the limit stipulated if the effective capital is ₹ 100 crores and above but less than ₹ 250 Crores the maximum yearly remuneration payable to the managerial persons shall not exceed ₹ 120 Lakhs. In the given scenario, the effective capital of the company is ₹ 120 crores. Hence, the company can pay renumeration to the managing director maximum up-to ₹120 lakhs without seeking approval of shareholders by passing a special resolution.