RST Ltd. recently issued the Equity Shares on basis of right issue. Due to this, the paid-up capital of the Company has been increased from ₹7.5 crore to ₹15 crore. The Company Secretary in the Board Meeting put up the p

As per rule 6 of the Companies (Meeting of Board and its power) Rules, 2014 read with rule 4 of the Companies (Appointment and qualification of Directors) Rule 2014, every listed company or public company having : Paid up capital of ₹10 crore or more or Turnover of ₹100 Crore or more or Aggregate outstanding loan, debenture and deposit exceeding ₹50 Crore Shall constitute the Audit Committee and Nomination and Remuneration Committee. Further, as per section 178 of the Companies Act, 2013 Nomination and Remuneration Committee shall have at least three members out of which not less than one half shall be Independent Director. Section 178 (2) of the Companies Act, 2013 stipulates that the Nomination and Remuneration Committee shall identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal and shall specify the manner for effective evaluation of performance of Board, its committees and individual directors to be carried out either by the Board, by the Nomination and Remuneration Committee or by an independent external agency and review its implementation and compliance. The performance of the Chairperson is linked to both the functioning of the Board as a whole as well as the performance of each director. The Nomination and Remuneration Committee provides that the Independent Director should review the performance of the Chairperson of the company taking into account the views of the executive directors and non-executive directors. In view of this, the proposal of the Company Secretary is valid as per the law.