Installing MacOS 11.3 creates a Relocated Items.nosync with changes to private/etc/group
After few months realized there is an extra item on desktop which I didn't create (called Relocated Items) so I guess machine was running even when this was not merged into /etc/group anymore. So I deleted it.
The only thing came up on my Filemerge was:
LHS: /Users/Shared/Relocated Items/Configuration/private/etc/group
RHS: /etc/group