Share transfer to a relative of a director

Geetha Gupta (Accountant) (325 Points)

13 April 2017  

Dear all,

When a member in a pvt company, who is also a director in the company wishes to transfer shares to the son of another director of the company, will this count as a related party transaction ?

As far as i understand - No. since this is not a transaction between the company and a relative of the director. It is a transaction between one director and a relative of another director.

Also, can the director-relative of the transferee vote in the resolution item for transfer of the shares in this situation? if think yes, since there is the exemption vide June 5th 2015 notification for pvt companies

Thanks in advance

Regards,

Geetha