Can a director let out a portion of his house for rent to the Company (Private) to carry its business, as a branch office? Will it be a related party transaction? If yes, what are the compliance's and if no, then please provide reasons for the same.
18 August 2015
It is simple procedure. Company just need to have Board meeting, wherein board should approve Leasing of Property for office (since in your case, limit is not exceeded). Then you can enter into an agreement for Leasing of Property.
The main point of Section 188 is to take prior approval or Board or Shareholder, as the case may be, before entering into such transactions.
Also ensure that you comply with whatever has been written in Section 188 and its Rules.
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