Requirement of approval by members for related party transaction
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Neha /
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23-Sep-2017 11:38 AM /
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In case a Public company is having a paid-up share capital of ten crore rupees or more, whether such a company requires prior approval of members by special resolution to enter any contract with any related party.
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Dear Neha,
In terms of the Companies (Meetings of Board and its Powers) Second Amendment Rules, 2014, the limit of paid-up capital of ten crore rupees for the purpose of requiring prior approval of members by special resolution for entering any contract with related party has been removed. The company is required to comply with the provisions of section 188 read with rule 15 of the Companies (Meetings of Board) Rules, 2014 for entering into any contract or arrangement with a related party.