Section 2(76)Chapter 1

(76) Related Party

Regulation 2

(1)

(zb)

of LODR

(76)

“related party”, with reference to a company, means—

(i)

a director or his relative;

(ii)

a key managerial personnel or his relative;

(iii)

a firm, in which a director, manager or his relative is a partner;

(iv)

a private company in which a director or manager or his relative is a member or director;

(v)

a public company in which a director or manager is a director or and holds along with his relatives, more than two per cent of its paid-up share capital;

(vi)

any body corporate whose Board of Directors, managing director or manager is accustomed to act in accordance with the advice, directions or instructions of a director or manager;

(vii)

any person on whose advice, directions or instructions a director or manager is accustomed to act:

Proviso

Provided that nothing in sub-clauses ( vi ) and ( vii ) shall apply to the advice, directions or instructions given in a professional capacity;

(viii)

any body corporate which is—

(A)

a holding, subsidiary or an associate companyassociate company of such company;

(B)

a subsidiary of a holding company to which it is also a subsidiary; or

(C)

an investing company or the venturer of a company;

Explanation

For the purpose of this clause, “the investing company or the venturer of a company” means a body corporate whose investment in the company would result in the company becoming an associate company of the body corporate.

(viii)

any company which is—

(A)

a holding, subsidiary or an associate company of such company; or

(B)

a subsidiary of a holding company to which it is also a subsidiary;

(ix)

such other person as may be prescribed

Notes, amendments & references (5)

inserted by the Companies (Removal of Difficulties) Sixth Order, 2014 vide order no. S.O.1894 (E) dated 24th July 2014.To view the order, Click Here

substituted by the Companies (Removal of Difficulties) Fifth Order, 2014 vide order no. S.O.1820 (E) dated 9th July 2014.To view the order, Click Here

(viii) Substituted vide Companies (Amendment) Act, 2017 dated 03.01.2018. To view the notification, Click Here

This clause do not apply to private company with respect to section 188, vide notification no. G.S.R. 464 (E) dated 5th June 2015.(The exceptions, modifications and adaptations provided above shall be applicable only to those Private Companies which has not committed a default in filing its financial statements under section 137 of the said act or annual return under section 92 of the said act with the registrar, vide notification dated 13th June 2017)To view the notification, Click Here 3. This clause shall not apply with respect to section 188 vide exemption notification to specified IFSC Public Companies, GSR 08 (E), Click Here

Refer rule 3 of Companies (Specification of definitions details) Rules, 2014. To view the rule, Click Here