Related Party Transactions Policy

  • 1. Introduction

    Kinara Capital promotes to be ethical and encourages authentic and transparent approach in all its dealings.

    Considering the requirements to approve the Related Party transaction as prescribed under Section 177, Section 188 and other applicable provisions of the Companies Act, 2013 (“the Act”), the company has framed this Policy with regard to Related Party Transactions (“RPT Policy”)

    The Board of Directors will review and may amend this policy from time to time on recommendation of the Audit Committee.

  • The objective of this policy is to prescribe a specified manner of dealing with Related Party Transactions as per the provisions of the Companies Act and any other applicable Regulations to ensure proper approval, disclosure and reporting of transactions as applicable, between the Company and any of its related parties, in the best interest of the Company and its stakeholders.

    The Scope of the Related Party Transaction covers below:

    • Materiality thresholds for Related Party Transactions
    • Related Party Transactions carried out in the ordinary course of business and at arm’s length.
    • Related Party Transactions to be entered into by the Company, except in accordance with the provisions of this RPT Policy
  • a) Audit Committee: As per Section 177 of the Companies Act, 2013, every listed Company and such other class or classes of companies, shall constitute an Audit Committee.Further, as per Regulation 68 of RBI Master Direction on Systematically Important Non-Banking Financial Companies, all applicable NBFCs shall constitute an Audit Committee consisting of not less than 3 (three) members of its Board of Directors.

    b) Board of Directors or Board in relation to a Company means the collective body of the directors of the Company.

    c) Key Managerial Personnel in relation to a Company means

    • i. The Chief Executive Officer, or the Managing Director or the Manager;
    • ii. The Whole-time director;
    • iii. The Chief Financial Officer
    • iii. The Company Secretary

    d) Related Party with reference to a Company, means

    • i. a director or his relative;
    • ii. a key managerial personnel or his relative;
    • iii. a firm, in which a director, manager or his relative is a partner;
    • iv. a private company in which a director or manager or his relative is a member or director;
    • v. a public company in which a director or manager is a director and holds along with his relatives,more than two per cent of its paid-up share capital;
    • vi. any body 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;
    • vii. any person on whose advice, directions or instructions a director or manager is accustomed toact:
    • viii. Provided that nothing in sub-clauses (vi) and (vii) shall apply to the advice, directions or instructions given in a professional capacity;
    • xi. any body corporate which is—
      • a. a holding, subsidiary or an associate company of such company;
      • b. a subsidiary of a holding company to which it is also a subsidiary;or
      • c. an investing company or the venturer of the company;

      Explanation.—For the purpose of this clause, “the investing company or the venturer of a company” means a body corporate whose investment in the company would result in the company becoming an associate company of the body corporate.

    • x. Director, other than independent director, or key managerial personnel of the holding company or his relative with reference to a company;
    • xi. An entity that is a related party under the applicable accounting standards

    e)Related Party Transaction

    • i. sale, purchase or supply of any goods or materials;
    • ii. selling or otherwise disposing of, or buying, property of any kind;
    • iii. leasing of property of any kind;
    • iv. availing or rendering of any services;
    • v. appointment of any agent for purchase or sale of goods, materials, services or property;
    • vi. such related party’s appointment to any office or place of profit in the company, its subsidiary company or associate company; and
    • vii. underwriting the subscription of any securities or derivatives thereof, of the company:

    As per Indian Accounting Standard (Ind AS) defines the term ‘related party transaction’ as a transfer of resources, services or obligations between a reporting entity and a related party, regardless of whether a price is charged.

    The CFO and the Company Secretary will prepare a management note with justification for entering into the contract/arrangement/transaction which will also include whether the transaction is in the ordinary course of business and at arm’s length.

    f)Relatives with reference to any person means anyone who is related to another, if—

    • i. they are members of a Hindu Undivided Family;
    • ii. they are husband and wife; or
    • iii. one person is related to the other in the following manner:
      • a. Father (including step-father)
      • b. Mother (including step-mother)
      • c. Son (including step-son)
      • d. Son’s wife
      • e. Daughter
      • f. Daughter’s Husband
      • g. Brother (including step-brother)
      • h. Sister (including step-sister)

    A “transaction” with a related party shall be construed to include single transaction or a group of transactions in a contract.”

  • All Related Party Transactions shall require the prior approval of the Audit Committee.

  • Each director and Key Managerial Personnel is responsible for providing Notice to the Board or Audit Committee of any potential Related Party Transaction involving him/her or his/her relative, including any additional information about the transaction that the Board or Audit Committee may request. The Board shall record the disclosure of Interest and the Audit Committee will determine whether the transaction does, in fact, constitute a Related Party Transaction requiring compliance with this policy.

    Such notice of any potential Related Party Transaction shall be given well in advance so that the Audit Committee has adequate time to obtain and review information about the proposed transaction.

  • All Related Party Transactions shall require prior approval/ratification of Audit Committee, whether at a meeting or by way of circulation resolution. However, where any transaction has not been approved or ratified by the Audit Committee within 3 (Three) months from the date of transaction, such transaction shall be voidable at the option of the Audit Committee and if the transaction is with a related party to any director or is authorized by any other director, the director concerned shall indemnify the Company against any loss incurred by the Company.

    Any member of the Audit Committee who has a potential interest in any Related Party Transaction will abstain from discussion and voting on the approval of the Related Party Transaction

  • The Audit Committee may grant omnibus approval for Related Party Transactions proposed to be entered into by the Company subject to the following conditions:

    The Audit Committee shall, after obtaining approval of the Board of Directors, specify the criteria for making the omnibus approval which shall include the following,namely:-

    • maximum value of the transactions, in aggregate, which can be allowed under the omnibus route in a year;
    • the maximum value per transaction which can beallowed;
    • extent and manner of disclosures to be made to the Audit Committee at the time of seeking omnibus approval;
    • review, at such intervals as the Audit Committee may deem fit, related party transaction entered into by the company pursuant to each of the omnibus approval made;
    • transactions which cannot be subject to the omnibus approval by the Audit Committee.

    The Audit Committee shall lay down the criteria for granting the omnibus approval in line with the policy on Related Party Transactions of the company and such approval shall be applicable in respect of transactions which are repetitive in nature. Further, the Audit Committee shall consider the following factors while specifying the criteria for making omnibus approval, namely:-

    • repetitiveness of the transactions (in past or in future);
    • justification for the need of omnibus approval.

    The Audit Committee shall satisfy itself regarding the need for such omnibus approval and that such approval is in the interest of the Company;

    Such omnibus approval shall specify

    • the name/s of the related party;
    • nature and duration of the transaction;
    • maximum amount of transaction that can be entered into;
    • the indicative base price / current contracted price and the formula for variation in the price if any; and
    • such other conditions as the Audit Committee may deem fit or information relevant or important for the Audit Committee to take decision on the proposed transaction;

    Provided that where the need for Related Party Transaction cannot be foreseen and aforesaid details are not available, Audit Committee may grant omnibus approval for such transactions subject to their value not exceeding Rs.1 crore per transaction.

    Audit Committee shall review, at least on a quarterly basis, the details of Related Party Transactions entered into by the Company pursuant to pursuant to the omnibus approval granted by the Audit ommittee earlier.

    Such omnibus approvals shall be valid for a period not exceeding one financial year and shall require fresh approvals after the expiry of such financial year.

  • Shareholder’s approval shall be sought for transactions with the related parties which are either not in the ‘Ordinary Course of Business’ or are not on an ‘arm’s Length Basis’ and exceeds the threshold prescribed under section 188 of the Companies Act 2013 and the rules thereunder, amended from time to time, shall also require the prior approval of the shareholders through ordinary resolution and no related party shall vote to approve on such resolutions whether the entity is a related party to the particular transaction or not.

    No member of the Company shall vote on ordinary resolution, to approve any contract or arrangement which may be entered by the Company, if such member is a related party to the contract or arrangement for which the ordinary resolution is being passed.

  • In the event the Company becomes aware of a Transaction with a Related Party that has not been approved under this Policy prior to its consummation, the matter shall be reviewed by the Audit Committee. The Audit Committee shall consider all of the relevant facts and circumstances regarding the Related Party Transaction, and shall evaluate all options available to the Company, including ratification, revision or termination of the Related Party Transaction. The Committee shall also examine the facts and circumstances pertaining to the failure of reporting such Related Party Transaction to the Committee under this Policy and shall take any such action it deems appropriate.

    In any case, where the Audit Committee determines not to ratify a Related Party Transaction that has been commenced without approval, the Audit Committee, as appropriate, may direct additional actions including, but not limited to, discontinuation of the transaction or seeking the approval of the shareholders, payment of compensation for the loss suffered by the related party etc. In connection with any review of a Related Party Transaction, the Audit Committee has authority to modify or waive any procedural requirements of this Policy.

  • Details of all material transactions with related parties shall be disclosed in the Annual Report.

    This Policy will be communicated to all operational employees and other concerned persons of the Company. The Company shall disclose the policy on dealing with Related Party Transactions on its website and a web link thereto shall be provided in its Annual Report.

  • The Company may constitute a steering committee which will be headed by the Chief Financial Officer and Company Secretary which will be headed members from Finance, Corporate Secretarial and other functions as may be determined by the Chief Financial Officer and Company Secretary

    The Steering Committee shall meet periodically to ensure that the actions agreed with the Audit Committee and the Board with respect to Related Party Transactions have been implemented. The Steering Committee shall also ensure that the systems and processes are in place for identification and approval of the related Party Transactions as per this Policy

  • In case there are any regulatory changes requiring modifications to the Policy, the Policy shall be reviewed by the Board of Directors at least once every three years and amended at the next possible opportunity.

    In case of any amendments, clarifications, circulars etc. the amended regulatory requirements will supersede the Policy till the time this Policy is suitably amended.