Skip to content

CS Professional · CSR and Social Governance · CSR Policy

Veda Textiles Ltd has a net profit of Rs 6 crore in the immediately preceding financial year, so section 135 applies to it. Its CSR obligation for the year is Rs 40 lakh. Who must discharge the functions of the CSR Committee, including formulating the CSR Policy?

The Board of Directors discharges the CSR Committee functions. Section 135(9) says that where the required CSR spend does not exceed fifty lakh rupees, no Committee is needed, and the Board performs its functions, including formulating the policy. Rs 40 lakh is within that limit.

  1. AAn independent director appointed specially for the purpose
  2. BThe Board of Directors of the company itselfCorrect
  3. CThe statutory auditor of the company
  4. DThe Company Secretary acting alone

Explanation

Under section 135(9), where the amount to be spent does not exceed fifty lakh rupees, the requirement to constitute a CSR Committee does not apply. The functions of the Committee are then discharged by the Board. Rs 40 lakh is below Rs 50 lakh, so the Board acts, not an individual officer or the auditor.

Did you get it right without looking?

One question tells you little. A timed set on CSR Policy shows your real accuracy, how long you take and where you lose marks.

Practise CSR PolicyFree diagnostic mock

More CSR Policy questions