Related Party Transactions & Recent Amendments in LODR, 2015

1. RELATED PARTY TRANSACTIONS &RECENTAMENDMENTS IN LODR,2015 AUTHOR :ACSDIVYAGUPTA@GMAIL.COM https://taxguru.in/sebi/related-party-transactions-recent-amendments-lodr-2015.html Note on Related Party Transactions and Recent Amendments inLODR,2015 RELATED PARTYTRANSACTIONS S.NO. PARTICULARS PRIVATE COMPANY UNLISTEDPUBLI Related party with reference to a company,means— a director or hisrelative; a key managerial personnel or hisrelative; a firm, in which a director, manager or his relative is apartner; a private company in which a director or manager or hisrelative DefinitionofRelatedPartyasper(v)apubliccompanyinwhichadirectorormanagerisadirectoran 1. capital; Companies Act,2013 any body corporate whose Board of Directors, managingdirecto instructions of a director ormanager; any person on whose advice, directions or instructions adirector Provided that nothing in sub-clauses (vi) and (vii) shall apply tothe a directors, other than an Independent Director or keymanager

2. any body corporate whichis— • a holding, subsidiary or an associate company of suchcompany; • a subsidiary of a holding company to which it is also a subsidiary;or (C) an investing company or the venturer of thecompany;”; N.A. 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.] Definition of Related Party asper N.A. 2. LODR,2015

3. Relative’ with reference to any person, means anyone who isrelated (1). they are members of a Hindu UndividedFamily (2). they are husband andwife (3). Father : Provided that the term “Father” includes step-father (4). Mother : Provided that the term “Mother” includesstep-mother (5). Son : Provided that the term “Son” includesstep-son 3. Definition ofRelative Son’swife Daughter Daughter’shusband Brother : Provided that the term “Brother” includesstep-brother (10). Sister : Provided that the term “Sister” includesstep-sister Related Party Transactions as prescribed under Section 188(1) ofCo sale, purchase or supply of any goods ormaterials; selling or otherwise disposing of, or buying, property of anykind Related PartyTransactions (c) leasing of property of anykind; 4. as per Companies Act,2013 (d) availing or rendering of anyservices; appointment of any agent for purchase or sale of goods,materials such related party’s appointment to any office or place of profitin underwriting the subscription of any securities or derivativesther

4. Related Party Transactions as per LODR, 2015: 5. Not applicable in case of Private and Unlisted PublicCompanies REVIEWMECHANISM/APPROVAL/RATIFICATION

5. All transactions of the company with related parties andsubsequent Audit Committee Approval as perExemption: 6. Companies Act,2013 The approval shall not be required for transactions entered into betw consolidated with such holding company and placed before theshare

6. Audit Committee Prior ApprovalN.A. 7. as per LODR,2015

7. Audit Committee may make omnibus approval for related party tran conditions,namely • The Audit Committee shall, after obtaining approval of theBoar • The Audit Committee shall consider the following factorswhile • repetitiveness of the transactions (in past or infuture); • justification for the need of omnibusapproval. • The Audit Committee shall satisfy itself on the need for omnibus interest of thecompany. • The omnibus approval shall contain or indicate the following:– • name of the relatedparties; Omnibus Approval of Audit (b) nature and duration of thetransaction; 8. Committee as per Companies Act, 2013 (c) maximum amount of transaction that can be enteredinto; the indicative base price or current contracted price and theform any other information relevant or important for the AuditCommi Provided that where the need for related party transaction cannot be omnibus approval for such transactions subject to their value notexc Omnibus approval shall be valid for a period not exceeding o financialyear. Omnibus approval shall not be made for transactions in respecto Exemption: The approval shall not be required for transactions entered into betw consolidated with such holding company and placed before theshare

8. Omnibus Approval of Audit N.A. Committee as per LODR,2015 9.

9. All Related PartyTransactions: which are in Ordinary Course of Business and not at arm’slengt which are not in Ordinary Course of Business and not at arm’sle all MaterialTransactions shall also be approved by the Board of Directors at a meeting or thro the interest of the Company subject to ratification at their nextfollow 10. BoardApproval Whereanydirectorisinterestedinanycontractorarrangementw discussions on the subject matter of the resolution relating to suchco Exemption: Approval shall not be requiredfor: transactions entered into by the company in its ordinary courseof transactions entered into between a holding company and its w company and placed before the shareholders at the general meetingf All Material Related Party Transactionsshall be approved bythe Exemption: per Approval shall not be requiredfor: Shareholders Approval as Companies Act,2013 11. 3. transactions entered into by the company in its ordinary courseof 4. transactions entered into between a holding company and its w company and placed before the shareholders at the general meetingf

10. The contracts or arrangements relatedto- sale, purchase or supply of any goods or material, directly or thr of thecompany. selling or otherwise disposing of or buying property of any kind of net worth of thecompany. leasing of property of any kind amounting to ten percent ormore availingorrenderingofanyservices,directlyorthroughappo Material Transactions Act,2013 Related Partycompany. 12. as perCompanies Explanation.-Itisherebyclarifiedthatthelimitsspecifiedinsub-c either individually or taken together with the previous transactionsd for appointment to any office or place of profit in the compan exceeding two and a half lakhrupees. is for remuneration for underwriting the subscription of any secu worth. Explanation.- (1) The turnover or net worth referred above shall b financialyear. Shareholders Prior Approval per LODR,2015 13. asN.A.

11. Material Related Party N.A. Transactions as per LODR,2015 14.