Question

Which of the following Companies will have to constitute Corporate Social Responsibility Committee under the Companies Act, 2013?

• A. A company having a net profit of 2.5 crores in a financial year, a net worth of 300 crores and a turnover of rupees 800 crore
• B. A company having a net profit of 3 crores in a financial year, a net worth of 300 crores and a turnover of rupees 600 crore
• C. A company having a net profit of 5 crores or more, a net worth of 500 crores and a turnover of rupees 1000 crore or more
• D. A company having a net profit of 5 crores or more, a net worth of 500 crores and a turnover of rupees 5000 crore or more

Hint:

CSR under Companies Act applies if net worth ≥ ₹500 cr OR turnover ≥ ₹1000 cr OR net profit ≥ ₹5 cr.

Answer 1

The Correct Option is C

Step 1: CSR provisions.
Section 135 of the Companies Act, 2013 mandates CSR for certain companies based on financial criteria.
Step 2: Criteria.
A company must constitute a CSR Committee if it has: - Net worth of ₹500 crore or more, OR - Turnover of ₹1000 crore or more, OR - Net profit of ₹5 crore or more during any financial year.
Step 3: Application.
Option (c) satisfies the above criteria exactly.
Step 4: Conclusion.
Hence, the correct answer is (c).