Based on the proposed Transaction A (Property Acquisition) and Transaction B (Services Agreement), analyze the compliance procedures required under…

(a) The question can be answered referring to Section 188 (1) read with Rule 15 (3) of the Companies (Meetings of board and its Powers) Rules, 2014 and First Proviso to Section 188 (1) and Second Proviso to Section 188 (1) of the Companies Act, 2013. (a) Required Level of Approval Transaction A (Property Acquisition-12 Crore): The transaction involves buying property of any kind. The threshold requiring prior shareholder approval (Ordinary Resolution) is triggered if the transaction value amounts to 10% or more of net worth of the company. SEI's Net Worth is 100Crore. The statutory limit is 10% of 100Crore, which equals 10Crore. Since the transaction value of 12Crore exceeds the 10Crore limit, SEL must obtain prior approval of the company by passing an ordinary resolution in a General Meeting. Transaction B (Services Agreement -45 Crore): The transaction Involves availing or rendering of any services. The threshold requiring prior shareholder approval is triggered if the transaction value amounts to 10% or more of the turnover of the company. SEL's Turnover is 500 Crore. The statutory limit is 10% of 500Crore, which equals 50Crore. Since the transaction value of 45Crore does not exceed 50Crore limit, the transaction can be entered into by obtaining the consent of the Board of Directors given by a resolution at a meeting of the Board. (b) Participation Restrictions (Board and General Meeting): Board Meeting Restrictions: For discussions on resolutions related to related party transactions. In case any director is interested in any contract or arrangement with a related party (i.e., D1, D2, and D3 for their respective related party transactions), he shall not be present at the meeting during discussions on the resolution relating to such contract or arrangement. General Meeting Voting Restriction (Second Proviso to Section 188 (1) ): Since Transaction A requires an Ordinary Resolution: A member of the company who is a related party shall not vote on the resolution meant for approving any contract or arrangement which may be entered into by the company. Assuming D2 is a shareholder, D2 must abstain from voting on the resolution approving the property acquisition.