Any holding company, subsidiary, fellow subsidiary or associate of the company.
## (g) Investing Company / Venturer
An investing company or venturer of the company (i.e., a company whose investment in the reporting company makes the reporting company its associate).
## (h) Person on whose advice the director/manager is accustomed to act
Any person on whose advice / instruction a director or manager is accustomed to act.
## (i) Other limbs
Such other person as may be prescribed.
A director (other than ID), KMP of the holding company, or relatives of such directors or KMP — also related parties.
## Important Exemption — Sec 2(76)(viii)
Section 2(76)(viii) shall NOT apply to a private company with respect to a transaction under Section 188 (related party transaction).
Meaning: Even if a body corporate qualifies as a related party of a private company under limb (viii), that limb is switched off for the purposes of Sec 188 compliance. This significantly reduces RPT compliance burden for private companies.
Worked example
### Example 1
Example 1 — 2% threshold for public co. Director D of ABC Ltd holds 1.5% in XYZ Ltd (a public company). D's wife and son together hold another 1%. D is also a director of XYZ Ltd. Are ABC and XYZ related? Combined holding (D + relatives) = 2.5% > 2%, and D is a director of XYZ. Both conditions met → Yes, XYZ is a related party of ABC under limb (d).
### Example 2
Example 2 — Private company exemption. P Pvt Ltd's Board acts on instructions of Mr. M (a director of M Pvt Ltd, the reporting company). M Pvt Ltd enters a transaction with P Pvt Ltd. Is Sec 188 attracted? Limb (viii) would normally bring P Pvt Ltd in. But the exemption to private companies under 2(76)(viii) means this limb does NOT apply for Sec 188 purposes. So the transaction is not an RPT under Sec 188 by reason of this limb.
⚠️ Common exam mistakes
Treating any 2% shareholding alone as enough for the public-company limb — the director-and-2% test requires BOTH conditions cumulatively (director PLUS >2% with relatives).
Missing the Sec 2(76)(viii) exemption for private companies under Sec 188.
Forgetting that 'relatives' (as defined in Sec 2(77)) is a narrow list — not everyone who is family qualifies.
Treating Independent Directors of the holding company as related parties under the KMP limb — limb (ix) specifically excludes IDs.
Bare-Act text Section 2(76) · Companies Act, 2013 · click to expand
Related Party, with reference to a company, means:
(i) a director or his relative;
(ii) a key managerial personnel or his relative;
(iii) a firm, in which a director, manager or his relative is a partner;
(iv) a private company in which a director or manager or his relative is a member or director;
(v) a public company in which a director or manager is a director and holds along with his relatives, more than two per cent of its paid-up share capital;
(vi) any body corporate whose Board of Directors, managing director or manager is accustomed to act in accordance with the advice, directions or instructions of a director or manager;
(vii) any person on whose advice, directions or instructions a director or manager is accustomed to act:
Provided that nothing in sub-clauses (vi) and (vii) shall apply to the advice, directions or instructions given in a professional capacity;
(viii) any body corporate which is a holding, subsidiary or an associate company of such company; or a subsidiary of a holding company to which it is also a subsidiary; or an investing company or the venturer of the company;
(ix) a director other than an independent director or key managerial personnel of the holding company or his relative.
Exemption: Sub-clause (viii) shall not apply with respect to a Section 188 transaction for a private company.