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    Question

    Except with the consent of the Board of Directors given

    by a resolution at a meeting of the Board and subject to such conditions as may be prescribed, no company shall enter into any contract or arrangement with a related party with respect to ______ 
    A sale, purchase or supply of any goods or materials Correct Answer Incorrect Answer
    B leasing of property of any kind Correct Answer Incorrect Answer
    C appointment of any agent for purchase or sale of goods, materials, services or property Correct Answer Incorrect Answer
    D underwriting the subscription of any securities or derivatives thereof, of the company Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    Section 188 of the Companies Act, 2013, regulates Related Party Transactions (RPTs), prohibiting companies from entering specific contracts (e.g., sale/purchase of goods, leasing, property disposal, or appointing agents/places of profit) with related parties without prior Board approval. Material transactions exceeding prescribed thresholds require shareholder approval via resolution, where the related party must abstain from voting. 

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