(Pursuant to Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015)
The Board of Directors (the “Board”) of Hira Automobiles Limited (the “Company” or “HAL”), has adopted
the following policy and procedures with regard to Related Party Transactions as defined below. his policy
is to regulate transactions between the Company and its Related Parties based on the applicable laws and
regulations as applicable on the Company.
This policy is framed as per requirement of Regulation 23 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and intended to ensure the proper approval and reporting of transactions
between the Company and its Related Parties. Such transactions are appropriate only if they are in the best
interest of the Company and its shareholders. The Company is required to make appropriate disclosure
each year in the Board Report regarding transactions between the Company and Related Parties as well as
policy concerning transactions with Related Parties.
“Audit Committee or Committee” means Committee of Board of Directors of the Company constituted
under provisions of Listing Regulations and Companies Act, 2013.
“Board” means Board of Directors of the Company.
“Control” shall have the same meaning as defined in SEBI (Substantial Acquisition of Shares and Takeovers)
“Key Managerial Personnel” means key managerial personnel as defined under the Companies Act, 2013
(i) Managing Director, or Chief Executive Officer or manager and in their absence, a whole- time director;
(ii) Company Secretary; and
(iii) Chief Financial Officer
“Material Related Party Transaction” means a transaction with a related party if the transaction /
transactions to be entered into individually or taken together with previous transactions during a financial year, exceeds ten percent of the annual turnover or of the company as per the last audited financial
statements of the company
“Policy” means Related Party Transaction Policy.
“Related Party” means related party as defined in Regulation 2(zb) of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 which is as follows:
a. is a related party under Section 2(76) of the Companies Act, 2013 which are as follows:
(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 is a member or
director ; (v) a public company in which a director or manager is a director or 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 under 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 company which is – (A) a holding, subsidiary or an associate company of such company ; or
(B) a subsidiary of a holding company to which it is also a subsidiary ;
(ix) Director or key managerial personnel of the holding company or his relative with reference to a
b. such entity is a related party under applicable accounting standards.
“Related Party Transaction” means any transaction directly or indirectly involving any Related Party which is
a transfer of resources, services or obligations between a company and a related party, regardless of
whether a price is charged.
“Relative” means relative as defined under the Companies Act, 2013 and includes anyone who is related to
another, if –
i. They are members of a Hindu undivided family; ii. They are husband and wife; or iii. Father (including
step-father) iv. Mother (including step-mother) v. Son (including step-son) vi. Son’s wife vii. Daughter
viii. Daughter’s husband ix. Brother (including step-brother) x. Sister (including step-sister)
All Related Party Transactions must be reported to the Audit Committee and referred for approval by the
Committee in accordance with this Policy. Although, the committee may grant omnibus approval to
repetitive transactions/other transactions in the best interest of the Company in accordance with
Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
4.1 Identification of Potential Related Party Transactions
Each director and Key Managerial Personnel is responsible for providing notice to the Board or Audit
Committee of any potential Related Party Transaction involving him or her or his or her Relative, including
any additional information about the transaction that the Board/Audit Committee may reasonably request.
Board/Audit Committee will determine whether the transaction does, in fact, constitute a Related Party
Transaction requiring compliance with this policy. The Company strongly prefers to receive such notice of
any potential Related Party Transaction well in advance so that the Audit Committee/Board has adequate
time to obtain and review information about the proposed transaction.
4.2 Prohibitions related to Related Party Transactions
All Related Party Transactions shall require prior approval of Audit Committee except the cases where
omnibus approval to repetitive transactions/other transactions in the best interest of the Company has
been given by the Committee in accordance with Regulation 23 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015.
Further, all Material Related Party Transactions shall require approval of the shareholders through special
resolution and the Related Parties shall abstain from voting on such resolutions.
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4.3 Review and Approval of Related Party Transactions
Related Party Transactions will be referred to the next regularly scheduled meeting of Audit Committee for
review and approval. Any member of the Committee who has a potential interest in any Related Party
Transaction will recuse himself or herself and abstain from discussion and voting on the approval of the
Related Party Transaction.
To review a Related Party Transaction, the Committee will be provided with all relevant material
information of the Related Party Transaction, including the terms of the transaction, the business purpose
of the transaction, the benefits to the Company and to the Related Party, and any other relevant matters.
In determining whether to approve a Related Party Transaction, the Committee will consider the following
factors, among others, to the extent relevant to the Related Party Transaction:
1.Whether the terms of the Related Party Transaction are fair and on arms length basis to the
Company and would apply on the same basis if the transaction did not involve a Related Party;
2.Whether there are any compelling business reasons for the Company to enter into the Related
Party Transaction and the nature of alternative transactions, if any;
3.Whether the Related Party Transaction would affect the independence of an independent director;
4.Whether the proposed transaction includes any potential reputational risk issues that may arise as
a result of or in connection with the proposed transaction;
5.Whether the Company was notified about the Related Party Transaction before its commencement
and if not, why pre-approval was not sought and whether subsequent ratification is allowed and
would be detrimental to the Company; and
6.Whether the Related Party Transaction would present an improper conflict of interest for any
director or Key Managerial Personnel of the Company, taking into account the size of the
transaction, the overall financial position of the director, Executive Officer or other Related Party,
the direct or indirect nature of the director’s, Key Managerial Personnel’s or other Related Party’s
interest in the transaction and the ongoing nature of any proposed relationship and any other
factors the Board/Committee deems relevant.
If the Committee determines that a Related Party Transaction should be brought before the Board, or if the
Board in any case elects to review any such matter or it is mandatory under any law for Board to approve
the Related Party Transaction, then the considerations set forth above shall apply to the Board’s review and
approval of the matter, with such modification as may be necessary or appropriate under the
Notwithstanding the foregoing, the following Related Party Transactions shall not require approval of Audit
Committee or Shareholders:
i. Any transaction that involves the providing of compensation to a director or Key Managerial Personnel in
connection with his or her duties to the Company or any of its subsidiaries or associates, including the
reimbursement of reasonable business and travel expenses incurred in the ordinary course of business.
ii. Any transaction in which the Related Party’s interest arises solely from ownership of securities issued by
the Company and all holders of such securities receive the same benefits pro rata as the Related Party.
5. Related Party Transactions not approved under this Policy
In the event the Company becomes aware of a Related Party Transaction with a Related Party that has not
been approved under this Policy prior to its consummation, the matter shall be reviewed by the
Committee. The Committee shall consider all of the relevant facts and circumstances regarding the Related
Party Transaction, and shall evaluate all options available to the Company, including ratification, revision ortermination of the Related Party Transaction. The Committee shall also examine the facts and
circumstances pertaining to the failure of reporting such Related Party Transaction to the Committee under
this Policy, and shall take any such action it deems appropriate
In any case where the Committee determines not to ratify a Related Party Transaction that has been
commenced without approval, the Committee as appropriate may direct additional actions including but
not limited to immediate discontinuation or rescission of the transaction. In connection with any review of
a Related Party Transaction, the Committee has authority to modify or waive any procedural requirements
of this Policy. This Policy will be communicated to all operational employees and other concerned persons
of the Company.