Policy On Related Party Transactions

DUDANI RETAIL LIMITED (EARLIER KNOWN AS DUDANI RETAIL PRIVATE LIMITED)

REGISTERED OFFICE: F-93, 3rd Floor Kartarpura Industrial Area, 22 Godam Jaipur, Station Road (jaipur), Jaipur, Jaipur, Rajasthan, India, 302006. TEL NO: +91 8690532399 EMAIL: TEAMDIVENA@GMAIL.COM

POLICY ON RELATED PARTY TRANSACTIONS

1. INTRODUCTION

The Board of Directors (the “Board”) of DUDANI RETAIL LIMITED (the “Company”) has upon the recommendation of the Audit Committee, adopted the following policy with regard to Related Party Transactions (hereinafter referred to as the ‘RPT Policy’ or ‘Policy’), in line with the requirements of Section 188 of Companies Act, 2013 read with Rules made thereunder (hereinafter referred to as ‘the Act’) and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as ‘LODR’).

2. PURPOSE

The objective of this policy is to ensure proper approval, disclosure and reporting of transactions as applicable, between the Company and any of its related parties in the best interest of the Company and its stakeholders. This Policy deals with materiality threshold, process of identification, disclosures and the manner of dealing Transactions with Related Party by the Company keeping in view the provisions of the Act, read with the rules made thereunder and LODR.

3. DEFINITIONS

“Arm’s length transaction (‘ALP’)” means a transaction between two related parties that is conducted as if they were unrelated, so that there is no conflict of interest.

“Audit Committee” means Committee of Board of Directors of the Company constituted under provisions of Regulation 18 of LODR and Section 177 of the Act.

“Board of Directors” or “Board” in relation to the Company means the collective body of the directors of DUDANI RETAIL LIMITED.

“Company” means DUDANI RETAIL LIMITED.

“Key Managerial Personnel” (KMP) in relation to the Company means: i. the Chief Executive Officer, or the Managing Director or the Manager; ii. the Company Secretary; iii. the Whole-time director; iv. Chief Financial Officer; and v. such other officer, not more than one level below the directors who is in whole-time employment, designated as key managerial personnel by the Board; and vi. such other officer as may be prescribed.

“Material Related Party Transaction” means a transaction with a related party, if the transaction(s) to be entered into individually or taken together with previous transactions during a financial year, exceeds rupees one thousand crore or ten percent of the annual consolidated turnover of the Company as per the last audited financial statements of the Company, whichever is lower.

 

“Material Modification(s)” means and include any modification to an existing RPTs, in aggregate with a related party, having variance of 25% in value of the transaction already approved by the Audit Committee or Board or Shareholders, as the case may be, or such modification as may be decided by the Audit Committee.

 

“Related Party”, with reference to a Company, shall have the same meaning as defined in Section 2(76) of the Companies Act, 2013 or Listing Regulations or under the applicable accounting standards as amended from time to time.

 

“Related Party Transaction” (RPT) means–

 

  • For the purpose of the Act, specified transaction mentioned in clause (a) to (g) of sub- section 1 of Section 188;

     

  • for the purpose of LODR, a transaction involving a transfer of resources, services or obligations between: (i) the Company or any of its subsidiaries on one hand and a related party of the Company or any of its subsidiaries on the other hand; or (ii) the Company or any of its subsidiaries on one hand, and any other person or entity on the other hand, the purpose and effect of which is to benefit a related party of the listed entity or any of its subsidiaries; regardless of whether a price is charged and a “transaction” with a related party shall be construed to include a single transaction or a group of transactions in a contract:

     

Provided that the following shall not be a related party transaction: (a) the issue of specified securities on a preferential basis, subject to compliance of the requirements under the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018; (b) the following corporate actions by the Company which are uniformly applicable/ offered to all shareholders in proportion to their shareholding: i. payment of dividend; ii. subdivision or consolidation of securities; iii. issuance of securities by way of a rights issue or a bonus issue; and iv. buy-back of securities.

 

“Relatives” with reference to any person shall have the meaning as defined in Section 2(77) of the Act read with clause 4 of The Companies (Specification of definition details) Rules, 2014.

 

A "transaction" with a related party shall be construed to include single transaction or a group of transactions in a contract.

 

Any other term not defined herein shall have the same meaning as defined in the Act, LODR, Securities Contracts (Regulation) Act, 1956 or any other applicable law or regulation.

 

4. MATERIALITY THRESHOLDS

The Listing Regulations requires a company to provide materiality thresholds for transactions beyond which the shareholders’ approval will be required by way of a special resolution. The Company has fixed its materiality threshold as follows:

 

  • a transaction with a related party shall be considered material, if the transaction(s) to be entered into individually or taken together with previous transactions during a financial year, exceeds rupees one thousand crore or ten percent of the annual consolidated turnover of the Company as per the last audited financial statements of the Company, whichever is lower, for the purpose of the Listing Regulations;

     

  • a transaction involving payments made to a related party with respect to brand usage or royalty shall be considered material if the transaction(s) to be entered into individually or taken together with previous transactions during a financial year, exceed five percent of the annual consolidated turnover of the Company as per the last audited financial statements of the Company.

     

5. POLICY ON RELATED PARTY TRANSACTIONS

The policy describes the procedure to be followed along with the reporting and disclosure requirements for the transactions entered between the Company and its Related Parties. Such transactions shall be deemed appropriate only if they are in the best interest of the Company and its shareholders. In order to ensure the same and to set forth the procedure for entering into and execution of transactions with Related Party, the board of directors of the Company has adopted this Policy.

 

a) Identification of potential related parties

 

  • Once a year, declarations will be obtained by the Company Secretary or Compliance Officer as the case may be from the Directors and KMP and other related parties within the meaning of Section 2(76), 184 and 189 of the Act and LODR in the prescribed format.

     

  • Any individual appointed/elected as a director or KMP shall be responsible to promptly complete and submit to the Company Secretary or Compliance Officer as the case may be, the disclosure declaration referred to above.

     

  • The declarations will also be required to be updated by the Directors and KMP regularly immediately upon a change taking place.

     

  • The Company Secretary or Compliance Officer as the case may be shall, in every meeting, place before the Audit Committee an up-to date list of the related parties of the Company.

     

b) Identification of potential related party transactions Each director and Key Managerial Personnel is responsible for providing Notice to the Board or Audit Committee of any potential RPT involving him/her or his/her relative, including any additional information about the transaction that the Board or Audit Committee may request. The Board shall record the disclosure of Interest and the Audit Committee will determine whether the transaction does, in fact, constitute a RPT requiring compliance with this Policy. The Company strongly prefers to receive such notice of any potential transactions with Related Party well in advance so that the Audit Committee has adequate time to obtain and review information about the proposed transaction.

 

c) Approval of Related Party Transactions

 

(i) Prior approval of Audit Committee of the Company:

 

  • All related party transactions and subsequent material modifications as prescribed under the Act and LODR shall require prior approval of Audit Committee of the Company, whether at a meeting or by Resolution by circulation.

     

  • However, the Audit Committee may grant omnibus approval for such Transactions proposed to be entered into by the Company subject to the following conditions:-

     

  1. The Audit Committee shall lay down the criteria for granting the omnibus approval in line with the policy on RPTs of the company and such approval shall be applicable in respect of transactions which are repetitive in nature.

     

  2. The Audit Committee shall satisfy itself the need for such omnibus approval and that such approval is in the interest of the company;

     

  3. Such omnibus approval shall specify the following:

     

    • the name/s of the related party, nature of transaction, period of transaction, maximum amount of transaction that can be entered into;

       

    • the indicative base price / current contracted price and the formula for variation in the price if any and;

       

    • such other conditions as the Audit Committee may deem fit;

       

Provided that where the need for RPT cannot be foreseen and aforesaid details are not available, Audit Committee may grant omnibus approval for such transactions subject to their value not exceeding Rupees One crore per transaction. 4) Audit Committee shall review, at least on a quarterly basis, the details of RPTs entered into by the company pursuant to each of the omnibus approval given. 5) Such omnibus approvals shall be valid for a period not exceeding one year and shall require fresh approvals after the expiry of one year. 6) Any member of the Audit Committee who has a potential interest in any RPT will abstain from discussion and voting on the approval of the RPT.

 

(ii) Prior approval of the Audit Committee of the Holding Company: (a) a related party transaction to which the Company is a party but the Holding Company is not a party, shall require prior approval of the audit committee of the Holding Company if the value of such transaction whether entered into individually or taken together with previous transactions during a financial year exceeds ten percent (10%) of the annual consolidated turnover, as per the last audited financial statements of the Holding Company. (b) a related party transaction to which the Company is a party but the Holding Company is not a party, shall require prior approval of the audit committee of the Holding Company if the value of such transaction whether entered into individually or taken together with previous transactions during a financial year, exceeds ten percent of the annual standalone turnover, as per the last audited financial statements of the Company.

 

(iii) Prior approval of Board of Directors under the Act a) RPTs within the scope of Section 188 of the Act, which are either not in the Ordinary Course of Business or are not at Arms’ Length shall require prior approval of the Board of Directors. b) In addition to the above, the following kinds of transactions with related parties are also placed before the Board for its approval:

 

  • Transactions which may be in the ordinary course of business and at arm’s length basis, but which are as per the policy determined by the Board from time to time (i.e., value threshold and/or other parameters) require Board approval in addition to Audit Committee approval;

     

  • Transactions in respect of which the Audit Committee is unable to determine whether or not they are in the ordinary course of business and/or at arm’s length basis and decides to refer the same to the Board for approval;

  • Transactions which are in the ordinary course of business and at arm’s length basis, but which as per Audit Committee requires Board approval;

  • Transactions meeting the materiality thresholds laid down in Clause 4 of the Policy, which are intended to be placed before the shareholders for approval.

In the above context, where any director is interested in any contract or arrangement with a related party, such director shall not be present at the meeting during discussions on the subject matter of the resolution relating to such contract or arrangement, and shall also not vote on such resolution.

(iv) Shareholders’ approval requirements Shareholder’s approval shall be sought in the following cases as per the requirements of the Act:

  • RPTs covered within the scope of Section 188 of the Act; which are either not in the ‘Ordinary Course of Business’ or are not on an ‘Arm’s Length Basis’ and exceed the threshold prescribed under the rules made thereunder, shall require prior approval of the shareholders through special resolution.

  • No member of the Company shall vote in a special resolution where a related party contract or arrangement is being considered if such a member is a related party in the context of the contract or arrangement which is being considered.

  • As per Section 188(3) of the Act, where any contract or arrangement is entered into by a director or any other employee, without obtaining the consent of the Board, consent of shareholders at a meeting is required to be obtained within three months from the date on which such contract or arrangement was entered into.

     

Shareholder’s approval shall be sought in the following cases as per the requirements of LODR:

 

  • All Material RPTs and subsequent material modifications covered within the scope of LODR shall require prior approval of the shareholders through a special resolution. For this purpose, no related party shall vote to approve such resolutions whether the entity is a related party to the particular transaction or not

     

  • However, the above shall not be applicable to such transactions as may be exempted by LODR, if not covered under the Act.

     

6. DISCLOSURES

Disclosures with respect to Transactions with Related Party shall be made as per applicable provisions of the Act and LODR.

 

7. RELATED PARTY TRANSACTIONS NOT APPROVED UNDER THIS POLICY

  • In the event the Company becomes aware of a transaction with a related party that has not been approved in accordance with this Policy prior to its consummation, the matter shall be reviewed by the Audit Committee. The Audit Committee shall consider all of the relevant facts and circumstances regarding the related party transaction, and shall evaluate all options available to the Company, including ratification, revision or termination of the related party transaction. The Audit Committee shall also examine the facts and circumstances pertaining to the failure of reporting such related party transaction to the Audit Committee under this Policy and failure of the internal control systems, and shall take any such action it deems appropriate.

     

  • In any case, where the Audit Committee determines not to ratify a related party transaction that has been commenced without approval, the Audit Committee, as appropriate, may direct additional actions including, but not limited to, discontinuation of the transaction or seeking the approval of the shareholders, payment of compensation for the loss suffered by the related party etc. In connection with any review/approval of a related party transaction, the Audit Committee has authority to modify or waive any procedural requirements of this Policy.

  • Where any contract or arrangement is entered into by a director or any other employee, without obtaining the consent of the Board or approval by a resolution in the general meeting under sub-section (1) of Section 188 of the Act and if it is not ratified by the Board or, as the case may be, by the shareholders at a meeting within three months from the date on which such contract or arrangement was entered into, such contract or arrangement shall be voidable at the option of the Board or, as the case may be, of the shareholders and if the contract or arrangement is with a related party to any director, or is authorised by any other director, the Directors concerned shall indemnify the company against any loss incurred by it.

     

8. SCOPE LIMITATION

In the event of any conflict between the provisions of this Policy and of LODR/the Act or any other statutory enactments, rules, then later shall prevail.

 

9. AMENDMENTS TO THE POLICY

The board of directors of the Company reserves the right to modify and/or amend this Policy at any time subject to the provisions of LODR and the Act and Rules framed thereunder.

 

This Policy is approved by the Board of Directors at their meeting held on March 27, 2026 and shall be effective from the date of listing of the equity shares of the Company.