Question

A company shall be deemed to be a subsidiary of another, if and only if__.
(1) That other controls the composition of its Board of directors
(2) That other holds more than half of the nominal value of its equity share capital
(3) The first mentioned company is a subsidiary of any company which is that other's subsidiary
(4) That first mentioned company is associate of other company
Select the comet the answer from the options given below-

• A. (2) & (3) of above
• B. (2) & (4) of above
• C. (1), (3) & (4) of above
• D. (1), (2) & (3) of above

Answer 1

The correct option is D (1), (2) & (3) of above

Subsidiary company means a company in which the holding company-

(i) controls the composition of the Board of Directors; or

(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:

Provided that such class or classes of holding companies as may be prescribed shall not have layers of subsidiaries beyond such numbers as may be prescribed.