Wholly owned subsidiary

Company E will be treated as an associate company of company A. Pls refer the defention of associate company - Section 2(6) of the Companies Act, 2013.

“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.

Here A has significant influence in Company E . Since Company A do not hold more than 50% shares in Company E it will not be a subsidiary but associate company of Company A.

Hope i have clarified your query.

Regards,

Arjun Rajagopal

I Completely agree with Arjun. A company is said to be subsidiary of other if other Company holds more than half of the share capital . A Company is said to be wholly owned subsidiary Company of other , if other Company holds entire 100% of the Subsi Company.

So Company A is associate Company of Company E but not wholly owned Subsidiary Company

Company E shall be considered as Wholly Owned Subsidiary Company. Please refer definition of Subsidiary Company. It has clearly mentioned.."(ii) exercises or controls more than one-half of the total share capital either at ITS OWN OR TOGETHER WITH ONE OR MORE OF ITS SUBSIDIARY COMPANIES.

Agree with Mr. Pratik. We need to see direct as well as indirect holding.

Originally posted by : Pratik Shah
	Company E shall be considered as Wholly Owned Subsidiary Company. Please refer definition of Subsidiary Company. It has clearly mentioned.."(ii) exercises or controls more than one-half of the total share capital either at ITS OWN OR TOGETHER WITH ONE OR MORE OF ITS SUBSIDIARY COMPANIES.

Thank You Sir for the correct interpretation.