Tycoon Private Limited is the holding company of Glassware Private Limited. As per the last profit and loss account for the year ending 31st March,…

(a) As per section 2 (85) of the Companies Act,2013, Small Company means a company, other than a public company: (i) paid-up share capital of which does not exceed four crore rupees, and (ii) turnover of which as per profit and loss account for the immediately preceding financial year does not exceed forty crore rupees: Provided that nothing in this clause shall apply to— (A) a holding company or a subsidiary company; (B) a company registered under section 8; or (C) a company or body corporate governed by any special Act. In the instant case, as per the last profit and loss account for the year ending 31st March, 2023 of Glassware Private Limited, its turnover was to the extent of 1.80 crore, and paid-up share capital was 80lakh. Though Glassware Private Limited, as per the turnover and paid-up share capital norms, qualifies for the status of a ‘small company’ but it cannot be categorized as a ‘small company’ because it is the subsidiary of another company (Tycoon Private Limited). Hence, the contention of the Company Secretary is correct.