X Ltd is selling land cost of Rs. 1 crore to related party group company at 10 crores. as per section 188 (1) (b) contract value or arrangement value exceeds 10% of net worth or 100 crores whichever is lower shareholders ordinary resolution required.
10% of net worth is Rs. 3 crores.
since cost of land is less than Rs. 1 crore but sale value is more than 10 crore for contract value or arrangement value we have to
consider cost or selling price
Whether ordinary resolution is required or not.
Thanks in advance
CAclubindia
