How can a company controls the composition of Board of directors of other company?

Achyutha Guptha (23 Points)

13 January 2024  

Dear Experts,

Section 2(87) of the Companies Act, 2013 defines "subsidiary company" as a
company in which the holding company -
a)controls the composition of the Board of Directors; or
b)exercises or controls more than one-half of the total share capital either at its
own or together with one or more of its subsidiary companies:

Reslistically speaking how can a company contorls or have right to change the composition of Board of directors without being majority shareholder? Is there any real world example which I can relate with?

‘associate company’, in relation to another company, means a company in which that other company has a significant influence, but which is not a subsidiary company of the company having such influence and includes a joint venture company.

Explanation.—For the purpose of this clause—

(a) the expression “significant influence” means control of at least twenty per cent. of total voting power, or control of or participation in business decisions under an agreement;

(b) the expression “joint venture” means a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement;

Same with this clause what does it mean participation in business decision, I mean what is the fine line which separates the participation and non participation in business decision

Thanks in Advance!