Best Practices for Handling Related Party Transactions in Private Limited Companies

Team IN Filings | Last updated: 23 February 2023

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Quick Summary

Related party transactions (RPTs) involve dealings between a company and its directors, key personnel, or their relatives. Section 188 of the Companies Act, 2013, mandates board and shareholder approval for these transactions to ensure fairness and transparency. While not inherently illegal, RPTs can lead to conflicts of interest and distorted financial reporting if not managed properly, as highlighted by past legal cases.

Related party transactions (RPTs) have been a contentious issue in the corporate world, especially in the private limited companies. These transactions are transactions between a company and its related parties, such as directors, key managerial personnel, and their relatives. The provisions for

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Team IN Filings

CA, Company Secretary, Legal service

We, Team IN Filings is a Tax and Law firm having its office in Bengaluru specializing in Company Law, Income tax, Gst, Labor law, Export Import, Trademark, Startup India etc. It is a professionally managed firm having a team of experienced Company Secretary, Chartered Accountant, Lawyer and Tax consultant to provide v ... Read more

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