Companies (Central Government’s) General Rules and Forms, 1956
11C. Section 372
(1) The board of directors of a company shall be entitled to invest in the shares of any other body corporate, pursuant to sub-section (2) of section 372, up to 34[thirty] percent, of the subscribed equity share capital, or the aggregate of the paid up equity and preference share capital, of such other body corporate, whichever is less.
Explanation. – Where the investments are made by a company together with its one or more subsidiary companies, the percentage specified in this sub-rule shall be computed with reference to the aggregate of the investments made by the company and its subsidiaries.
(2) The aggregate of the investments made by the board in all other bodies corporate shall not, except with the previous approval of the Central Government, exceed-
(i) thirty per cent of the aggregate of the subscribed capital and free reserves of the investing company; and
(ii) 32[thirty] per cent of the aggregate of the subscribed capital and free reserves of the investing company, where such other bodies corporate are in the same group.
33[(3) Where a company which has defaulted in repayment of any deposit referred to in section 58A or any part thereof or interest thereon in accordance with the terms and conditions of such deposit, it shall not be entitled to invest in the share of any other body corporate under section 372 till the default is made good.]