Section 87 — Subsidiary company not to hold shares in its holding company

(1) No company shall, either by itself or through its nominees, hold
any shares in its holding company and no holding company shall allot or transfer
its shares to any of its subsidiary companies and any such allotment or transfer of
shares of a company to its subsidiary company shall be void:

Provided that a subsidiary shall not be barred—

(a) from acting as a trustee unless its holding company is beneficially
interested under the trust; and

(b) from dealing in shares of its holding company in the ordinary course
of its business, on behalf of its clients only subject to non-provision
of any financial assistance where such subsidiary carries on a bona
fide business of brokerage:

Provided further that a subsidiary dealing in shares of its
holding company in the ordinary course of its brokerage business,
shall not exercise the voting rights attached to such shares.

Provided also that the provisions of this section shall not be
applicable where such shares are held by a company by operation of
law.

(2) Any violation of this section shall be an offence liable to a penalty
of level 2 on the standard scale.