If I am the promoter of Co A and Co A holds 15% of the voting power of Co B, (therefore not an associate company or a company with substantial interest) can I become the independent director of Co B?
The provisions restrict holding of 2% or more voting power for the individual and his relative but this particular case does not seem to be covered.
This question is on associates and not independent director, Here's the definition of associate company as per the companies Act.
ASSOCIATE COMPANY
Section 2 Subsection (6) “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 purposes of this clause, “significant influence” means control of at least twenty per cent. of total share capital, or of business decisions under an agreement.
Now as you should be getting it by now an associate is not just a company in who’s the concerned company holds more than 20% of share capital but also includes a company which is having influence over the latter’s decision making process under an agreement.
Thus in your case even if A company holds just 15% of the paid up capital of B ltd it might be also an associate if A ltd is having influence over the latter’s decision making process under an agreement.
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