Does Brother Son Falls in Category of Relative in Indian Company Act

[Parveen Komal]

The Indian Companies Act, 2013, defines relationships under various sections to establish the criteria for related party transactions, directorship qualifications, and other corporate governance matters. The term "relative" is specifically defined in the Companies Act.

According to Section 2(77) of the Indian Companies Act, 2013, a "relative" concerning any person, means anyone who is related to another, if:

1. They are members of a Hindu Undivided Family,
2. They are husband and wife, or
3. One person is related to the other in such manner as may be prescribed.

The rules prescribed under the Act further detail the relationships that constitute a 'relative'. This list includes father (including stepfather), mother (including stepmother), son (including stepson), son's wife, daughter, daughter's husband, brother (including stepbrother), and sister (including stepsister).

Thus, under the Indian Companies Act, a brother's son (nephew) does not fall directly under the definition of a "relative" as per the specific list provided in the Act. The Act focuses more on immediate family members and direct relations. However, it's important to note that interpretations and applications can vary,

[Parveen Komal]

Based on the information provided, a son of a brother (nephew) is not explicitly mentioned as a relative under the Companies Act, 2013
However, the Act does include "son" in its definition of a relative

It is important to note that the Companies Act, 2013, has reduced the list of relatives compared to the Companies Act of 1956


In the context of the Indian Companies Act, the term "relative" is defined under Section 2(77) and includes various relationships such as father, mother, son, brother, and sister, along with their step-counterparts. However, there is no specific mention of step-daughter as a relative

The Act also specifies that on the division of a Hindu Undivided Family, members not included in the list of relatives cease to be considered relatives

[Parveen Komal]

Under the Indian Companies Act, 2013, the definition of "relative" is provided in Section 2(77). It explicitly lists the following relationships as relatives:

1. Members of a Hindu Undivided Family
2. Husband and Wife
3. Father (including step-father)
4. Mother (including step-mother)
5. Son (including step-son)
6. Son's wife
7. Daughter
8. Daughter's husband
9. Brother (including step-brother)
10. Sister (including step-sister)

The Act does not explicitly include nephews in the list of defined relatives. Therefore, under the strict legal definition provided by the Companies Act, 2013, a nephew does not fall into the category of a "relative." This categorization is relevant when considering related party transactions and other aspects of corporate governance that require the identification of relatives.

[Parveen Komal]

Does nephew Falls in Category of Relative in Indian Company Act and is a Related Party Transactions

In the context of the Indian Companies Act, 2013, understanding whether a nephew falls within the category of a "relative" and if transactions involving a nephew qualify as "related party transactions" requires clarifying both concepts as defined by the Act. Relative


As previously discussed, Section 2(77) of the Companies Act, 2013, defines a "relative" with respect to another person. The Act provides a specific list that includes parents, siblings, spouse, children, and their spouses. Nephews are not included in this list, implying that, for most provisions, a nephew is not considered a "relative" under the strict definition provided by the Act. Related Party Transaction


Related party transactions are governed under Section 188 of the Indian Companies Act, 2013. A "related party," with respect to a company, includes:

• Directors or their relatives
• Key managerial personnel or their relatives
• Firms, in which a director, manager, or their relative is a partner
• Private companies, in which a director or manager is a member or director
• Public companies, in which a director or manager is a director and holds along with his relatives, more than 2% of its paid-up share capital
• Anybody 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
• Any person under the control of any of the above categories

Given that a nephew does not qualify as a "relative" under the definition provided in Section 2(77), transactions involving nephews are not automatically categorized as "related party transactions" based solely on that familial relationship. However, if the nephew fits into any other category defined as a "related party" — for example, if he is a director or holds a significant shareholding in a company that makes him a related party in his own right — then transactions involving him may need to be scrutinized as "related party transactions."

It's crucial to analyze the specific circumstances of each case and the roles individuals play within the company to determine if a transaction falls within the scope of related party transactions. Since the Companies Act aims to ensure transparency and prevent conflicts of interest in transactions involving close associates of the company's directors and key managerial personnel, companies are advised to exercise caution and seek legal counsel when dealing with transactions that might be construed as related party transactions.

[SwatiSood]

In Indian company law, the Companies Act, 2013 does not specifically define the term "brother's son" or provide a comprehensive list of relatives. However, the Act does define certain categories of relatives in relation to a director of a company.

As per Section 2(77) of the Companies Act, 2013, the term "relative" with reference to any person, includes any of the following individuals:

1. Members of the Hindu Undivided Family (HUF), such as brothers, sisters, ancestors, lineal descendants, and spouses.
2. Spouses, which includes husband or wife.
3. Individuals related by blood or marriage in a manner specified in the Act.
4. Brothers or sisters of the whole blood or half-blood.
5. Uncles, aunts, nephews, and nieces.
6. Lineal ascendants and descendants, including step-parents and step-children.

Based on the above definition, a brother's son (nephew) would generally be considered a relative within the scope of the Companies Act, 2013 in India.

It's important to note that the Companies Act, 2013 contains various provisions and restrictions related to related party transactions, appointment of directors, and other matters involving relatives. Therefore, it is advisable to consult with a legal professional or refer to the relevant provisions of the Act for specific and up-to-date information.

[harsh]

In the context of the Indian Companies Act, the definition of "relative" is provided under Section 2(77) of the Companies Act, 2013. According to this section, a relative includes:

1. Members of a Hindu Undivided Family (HUF).
2. Spouse.
3. Father (including step-father).
4. Mother (including step-mother).
5. Son (including step-son).
6. Son's wife.
7. Daughter.
8. Daughter's husband.
9. Brother (including step-brother).

[harpreetkaur]

In the context of the Indian Companies Act, the term "relative" is defined under Section 2(77) of the Companies Act, 2013. According to this definition, a relative includes the following:

1. Spouse
2. Father
3. Mother (including stepmother)
4. Son (including stepson)
5. Daughter (including stepdaughter)
6. Brother (including stepbrother)

Therefore, under the Indian Companies Act, a brother falls within the definition of a relative. This means that when the Act refers to relatives in various provisions such as related party transactions, shareholding disclosures, or appointments of directors, it includes brothers as well.