Meaning
In ordinary parlance, an office or place of profit means an office or profit or position, which brings to the person holding it some pecuniary gain or advantage or benefit. It will be an office or place of profit if it carries some remuneration, pecuniary advantage, benefit etc. The amount of such profit is immaterial. Section 314 of the Companies Act,1956 regulates the provisions relating to appointment of a director or any relative , firm, body corporate to an office or place of profit. The underlying object of this section is to ensure that those who occupy a fiduciary position in the company do not misuse, directly or indirectly, except with the permission of the shareholders or central government in certain cases. The provisions of this section are applicable to both public and private companies. The Companies Bill, 2003 proposes that the section shall not be applicable to private companies.
The provisions of this section are very interesting to ponder, to understand its compliance and implication as it is one of the very difficult section in the Companies Act, 1956. To read further click on the following link below:
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