Related Party Transaction Criteria Amended by MCA


Ministry of Corporate Affairs (MCA) had notified amendment in the Companies (Meeting of Board and its Powers) Rules, 2014 and amended criteria for Related Party Transactions (RPT) by amending Rule 15 (3) (a) (i) to (iv) of these Rule via Notification dated 18.11.2019

Following are the amendments in threshold limits for entering into any transaction by any Company with its Related Party, as prescribed under section 188(1) (a ) to (e ) of the Companies Act 2013 , only with the approval of members by way of an Ordinary Resolution.

(i) sale, purchase or supply of any goods or material, directly or through appointment of agent, amounting to ten percent or more of the turnover of the company [or rupees one hundred crore, whichever is lower].

(ii) selling or otherwise disposing of or buying property of any kind, directly or through appointment of agent, amounting to ten percent or more of net worth of the company [or rupees one hundred crore, whichever is lower];

(iii) leasing of property any kind [amounting to ten per cent or more of the turnover of the company];

(iv) availing or rendering of any services, directly or through appointment of agent, amounting to ten percent or more of the turnover of the company [or rupees fifity crore, whichever is lower] :

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