In terms of the Section 45NAA of the RBI Act 1934 the ldquo group company rdquo shall mean an arrang...........

Professional Legal Knowledge RBI Act

In terms of the Section 45NAA of the RBI Act, 1934, the “group company” shall mean an arrangement involving two or more entities related to each other through either subsidiary – parent or joint venture or associate or promoter-promotee or related party or common brand name or investment in equity shares of ________ and above in the entity.

20%

10%

25%

None of the above

Explanation:

Correct Option: 1 (20%)

Definition: As per Section 45NAA of the RBI Act, 1934, a "group company" refers to entities connected through specific relationships such as subsidiary-parent, joint venture, associate, promoter-promotee, related party, or common brand name.
Equity Investment Threshold: An entity is considered a "group company" if there is an investment in equity shares of 20% or more in the entity.
Regulatory Significance: This classification ensures transparency and enables RBI to monitor interrelated entities under its regulatory purview, critical for NBFC regulation.