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Sundar Foods Ltd is covered by section 135(1) but its required CSR spend under section 135(5) for the year is Rs 45 lakh. Which statement is correct?

The CSR Committee need not be constituted, and the Board of Directors discharges its functions. Section 135(9) provides this where the amount to be spent does not exceed Rs 50 lakh. The obligation to spend Rs 45 lakh still remains.

  1. AIt must still constitute a CSR Committee of at least three directors including an independent director
  2. BThe CSR Committee requirement does not apply and the Board of Directors discharges the Committee's functionsCorrect
  3. CThe CSR Committee requirement does not apply and the functions pass to the Audit Committee
  4. DIt is exempt from spending anything because the amount is below Rs 50 lakh

Explanation

Section 135(9) states that where the amount to be spent does not exceed fifty lakh rupees, the Committee need not be constituted and the Board discharges its functions. The spending obligation itself remains, so option D is wrong.

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