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CS Executive · Company Law and Practice · Key Managerial Personnel and their Remuneration

Kaveri Textiles Ltd maintains its register of directors and key managerial personnel. Its director Mr. Arvind Rao holds shares in Kaveri's wholly owned subsidiary and also in a company that is an associate of Kaveri. Which statement correctly describes what the register must show?

The register must include securities held by the director in the company itself and in its holding company, subsidiary, subsidiary of the holding company, and associate companies. So Mr. Rao's holdings in the subsidiary and the associate must be shown, as Section 170(1) provides.

  1. AOnly securities held in Kaveri Textiles Ltd itself
  2. BSecurities held in Kaveri, its holding, subsidiary, subsidiary of its holding company or associate companiesCorrect
  3. COnly securities held in Kaveri and its subsidiaries, not associates
  4. DOnly securities held in listed group companies

Explanation

Section 170(1) says the register must include details of securities held by each director and KMP in the company or its holding, subsidiary, subsidiary of the company's holding company or associate companies. Limiting it to the company alone or excluding associates ignores the wording of the section.

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