Divya

Inter-corporate loan falls under the ambit of Section 186. Loan to associate company does not attract provisions of Section 188. In case of other transactions (like leasing or sale or purchase of goods) attracting the provisions of Section 188, only Company B would be required to obtain approval of its Board under Section 188 for entering into transaction with its associate company A. Company A need not obtain board approval for entering into transaction with Company B. No reciprocity is required.