Associates of other company

Consequences:  Associate will be related party u/s 2(76) and you will  have to prepare consolidated financial statements u/s 129(3).

Action required to reduce holding:  You have to transfer shares in normal manner (Board resolution + share transfer Form SH.4 etc.)

Thank You Sir for your reply.

I further want to know what is the time period for share tranfer so that my holding reduce to less than 20% and no consolidated B/S need to be prepare.

You should transfer shares before the end of the current financial year.