M Ltd. holds 35% nominal value of paid-up capital in O Ltd. N Ltd. is also holding 30% paid-up capital in O Ltd. M Ltd. holds 80% of paid-up capital in N Ltd. What is the relationship between M Ltd. and O Ltd.?

As per section 4 of Companies Act, 1956, the company jointly under the control of two companies is subsidiary company of parent company that is a subsidiary company of main parent company. M Ltd. is the parent company in this case. M Ltd. and O Ltd. is holding subsidiary relationship between each other. The correct option is (2). This is not a joint venture because O Ltd. is not under the joint control of M Ltd. and N Ltd.