Company Fails to Obtain Shareholders’ Approval for Major Related Party Transactions: MCA imposes penalty

The MCA imposed a penalty on a company for failing to obtain shareholder approval for major related-party transactions. The company did not seek the necessary approval before engaging in transactions with related parties, violating the provisions of the Companies Act. The penalty serves as a reminder to businesses about the importance of adhering to corporate governance norms, especially in situations where conflicts of interest may arise due to related-party dealings.