97. Distinction between Section 297 and 299

Following are the major differences between Section 297 and 299
1.	Section 297 is applicable only to contract for sale, purchase or supply of goods or services or underwriting subscription of shares or debentures of the company. It excludes the sale or purchase for cash prevalent at market prices. Section 299 applies to any contract or arrangement in which director is interested.
2.	Section 297 becomes applicable when contract is with Director, his relative, firm in which he/his relative is a partner, any partner of such firm or a private company in which he is a Director or member. Section 299 applies to any contract or arrangement. The contract may be with a public company, if total shares of all Directors together exceed 2% in the other company.
3.	Section 297 insists approval of the Board (Approval of Central Government If paid up capital of the company exceeds one crore rupees) Section 299 requires only disclosures of interest.
4.	Section 297 requires specific contracts. Only annual notice of disclosure is sufficient under Section 299
Section 299 is much wider than Section 297. Contracts covered under Section 297 will covered by Section 299 also, but not vice versa.