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CMA Final · Corporate and Economic Laws · Corporate Governance and Social Responsibility and Sustainability

Which statement about the CSR Committee's composition under Section 135 of the Companies Act, 2013 is correct for a company not required to appoint an independent director under section 149(4)?

A company that is not required to appoint an independent director under section 149(4) must still have a CSR Committee, but it needs only two or more directors rather than three. The independent director condition does not apply to it.

  1. AIt must have three or more directors including one independent director
  2. BIt must have two or more directorsCorrect
  3. CIt must have at least five directors
  4. DIt need not be constituted at all

Explanation

Section 135(1) requires three or more directors, with at least one independent director. The proviso says that where a company is not required to appoint an independent director under section 149(4), its CSR Committee must have two or more directors. Hence the independent-director requirement does not apply.

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