Clause in AOA pertaining to related party

    Posted By : damini / Published on : 15-Oct-2019 08:31 AM / View : 15 / Comment : 0
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    Dear Members,

    Query is as related Party is being defined in the CA,2013(attached) can a Private Limited Company Put its own Clause in the AOA pertaining to Related Parties ' like Shareholders, directors (excluding Nominee Director), key employees earning more than 500000 per month ?

    Plz help?
    As per section 2(76) of Companies Act, 2013 the term Related party transaction means-

    Related party with reference to a company means-

    A director or his relative
    A key managerial personnel or his relative
    A firm, in which a director, manager or his relative is a partner
    A private company in which a director or manager is a member or director
    A public company in which a director or manager is a director or holds along with his relative more than 2% of his paid up share capital
    Anybody 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
    Any person on whose advice, directions or instructions a director or manager is accustomed to act: provided that nothing in sub-clauses (vi) and (vii) shall apply to advice, directions or instructions given in professional capacity
    Any company which, is
    A holding, subsidiary or an associate company of such company
    A subsidiary of a holding company to which it is also a subsidiary
    A director or key managerial personnel of the holding, subsidiary or associate company of such company or his relative
    Any person appointed in senior management in the company or its holding, subsidiary or associate company i.e. personnel of the company or its holding, subsidiary or associate company who are core management team excluding board of directors comprising all members of management one level below the executive directors, including functional heads.
    Read more on : party related pertaining clause



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