Section 2(76) of the Companies Act, 2013 – Related Party
‘Related party’ has got a lot of significance in the public reporting scenario. In case of public companies public and society stake is involved and in case of private companies, even if public stake is not involved, the stake of other elements of society may be directly or indirectly involved. In such situation, maintaining transparency in the working of a company or a body corporate is very much essential. Transactions with related parties may if not entered into with due care may give a wrong perception and may hinder the transparency of the entity. This has given the regulators to keep a check on related party transactions by way of legal provisions in various legislations.