Related Party Transactions by Dipti Mehta Partner Mehta & Mehta Company Secretary
Both under the 2013 Act , requirements concerning related party transactions may be divided into four key parts, viz., identification of related parties, related party transactions, approval process and disclosure requirements. It is clear from discussion below that in most cases, The definition of ‘related party’ under RC49 is likely to result in identification of significantly higher number of related party. Unlike the 2013 Act, RC49 does not exempt related party transactions from special resolution of disinterested shareholders based on criteria, viz., (i) transaction is in the ordinary course of business and at arm’s length, or (ii) prescribed threshold regarding transaction value and share capital are not breached.
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