APPLICABILITY OF SECTION 297(1)

[HIMANSHU JARIWALA]

XYZ PVT. LTD. is going to sell its product to ABC INDUSTRIES a PARTNER SHIP FIRM in which DIRECTORS of XYZ PVT. LTD. are PARTNERS whether SECTION 297 (1) is applicable and permission of central government required? Paid Up Capital of XYZ Pvt. Ltd. is above Rs. 1.00 crore.

AI Summary

XYZ Pvt. Ltd. must seek central government approval for sales to ABC Industries under Section 297(1) due to capital size. XYZ Pvt. Ltd. plans to sell products to ABC Industries, a partnership firm where XYZ's directors are partners. The query concerns whether Section 297(1) of the Companies Act applies, necessitating central government approval due to XYZ's paid-up capital exceeding Rs. 1 crore. The response confirms that Section 297(1) is applicable, and central government permission is indeed required.