Skip to content

CS Professional · CSR and Social Governance · Guidelines on CSR

Zenith Polymers Ltd, an Indian company, has a net profit of Rs 6 crore in the immediately preceding financial year, so it is covered by section 135. The amount it must spend on CSR for the year is Rs 40 lakh. Who discharges the functions of the CSR Committee in this company?

The Board of Directors performs the CSR Committee's functions. Where the CSR amount to be spent does not exceed fifty lakh rupees, the requirement to constitute a CSR Committee does not apply, so the Board itself discharges those functions.

  1. AThe Board of Directors, because the amount to be spent does not exceed fifty lakh rupeesCorrect
  2. BThe Audit Committee, because it is the nearest statutory committee
  3. CA CSR Committee of at least three directors including one independent director, because the company is covered by section 135
  4. DThe implementing agency engaged by the company

Explanation

Under section 135(9), where the amount to be spent under sub-section (5) does not exceed fifty lakh rupees, the requirement to constitute the CSR Committee does not apply. The Board of Directors discharges the Committee's functions. Option C ignores this exemption.

Did you get it right without looking?

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

Practise Guidelines on CSRFree diagnostic mock

More Guidelines on CSR questions