RELATED PARTY TRANSACTION POLICY & POLICY FOR MATERIAL SUBSIDIARIES
April 1, 2014
The Audit Committee of the Board of Directors of the Company ("the Board") is required by Section 177(4) of the Companies Act, 2013 (Act) and Regulation 23 of SEBI (Listing Obligation and Disclosures Requirements) Regulation,2015 to approve all transactions of the Company with related parties ("RPT's").
The Policy on dealing with RPT's is formulated in compliance with Regulation 23 of SEBI (Listing Obligation and Disclosures Requirements) Regulation, 2015 and section 188 of the Act and Rules made thereunder.
OBJECTIVE OF THE POLICY
The Policy is intended to ensure timely identification of an RPT, its salient terms and conditions, detail the approval process, outline the disclosure and reporting requirements thereof and to ensure transparency in the conduct of RPT's, so that there is no conflict of interest.
The Board of Directors of the Company ("the Board') has adopted this Policy with respect to RPT's on the recommendation of the Audit Committee. The Audit Committee is empowered to review and recommend amendments to this Policy as may be considered necessary from time to time.
1. Related Party Transaction
As per the Regulation 2 of SEBI (Listing Obligation and Disclosures Requirements) Regulation, 2015 a RPT means a transfer of resources, services or obligations between a listed entity and a related party, regardless of whether a price is charged and a "transaction" with a related party shall be construed to include a single transaction or a group of transactions in a contract.
A transaction with a related party shall be construed to include a single transaction or a group of transactions in a contract.
A related party will be identified on the basis of the definition given in the Companies Act,2013.
2. Manner of Dealing with Related Party Transactions
The Company has formulated guidelines for identifying and monitoring RPTs as prescribed under the Act and Clause 49 of the Listing Agreement which has been approved by the Board and the same will be strictly adhered to.
3. Approval of RPTs by the Audit Committee
All RPTs, whether material or not, will require the prior approval of the Audit Committee of the Board.
4. Omnibus Approval by Audit Committee
The Audit Committee may, owing to the repetitive nature of transactions to be entered into or when the need for RPT's cannot be foreseen in advance, grant Omnibus Approval for such RPTs in accordance with the Cl. 49 of the Listing Agreement.
Any transactions of the value less than Rs.200,000/- whether individually or jointly in the financial year, will be considered to have Omnibus approval of the Audit Committee.
5. Approval of RPTs by the Board of Directors
Related Party Transactions which are required to be approved by the Board of the Company under the provisions of the Companies Act, 2013 or Listing Agreement shall be entered into only after such approval is accorded by the Board.
Where any director is interested in any contract or arrangement with a related party, such director shall not be present at the meeting during discussions on the subject matter of the resolution relating to such contract or arrangement.
6. Approval of RPTs by the shareholders
Related Party Transactions which are required to be placed before the shareholders of the company under the Act or the Listing Agreement shall be entered into only after such approval has been accorded by the shareholders. The company shall ensure the restrictions on voting by the Related Parties as prescribed are complied while obtaining the approval of the shareholders.
and approval of Related Party Transactions
The Audit Committee, Board and shareholders, as the case may be shall be provided with all relevant information of RPTs such as rational for entering into transactions, terms & conditions, the business purpose of the transactions, the benefits to the Company and Related Party and such other information as may be prescribed.
8. RPTs not approved by the Audit Committee or the Board
In the event of the contract entered into without the prior approval of Board or shareholder, due to extreme necessity the same shall be ratified by the Board, and/or shareholders, as required within 3 months of the entering into the contract. If not, the contract / arrangement shall be voidable at the option of the Board.
9. Disclosures by the Company:
(a) The particulars of contracts or arrangement with Related Parties will be disclosed in the Register of Contracts or Arrangements in which directors are interested (refer Rule 16 of the Companies (Meetings of the Board and its Powers) Rules, 2014 and in the Directors' report in Form AOC-2, in the manner prescribed in the Companies Act, 2013 and the Rules thereunder.
(b) Details of all material transactions with related parties shall be disclosed quarterly along with the compliance report on corporate governance and the company shall disclose the policy on dealing with Related Party Transactions on its website and a link thereto shall be provided in the Annual Report.
Policy for determining Material Subsidiaries/Materiality Policy
A subsidiary shall be considered as material if the investment of the company in the subsidiary exceeds twenty per cent of the consolidated net worth as per the audited consolidated balance sheet of the previous financial year or if the subsidiary has generated twenty per cent of the consolidated income of the company during the previous financial year.