Question

A listed company has an average net profit of Rs. 12 crore in the last 3 years. As per Section 135 of the Companies Act, 2013, which of the following statements is correct regarding CSR obligation?

CSR applies if net worth 500 cr, turnover 1,000 cr, or net profit 5 cr. Here, profit exceeds 5 cr, so 2 of average net profit 24 lakh must be spent.

A No CSR spending required since net profit is below Rs. 15 crore.

B CSR expenditure of at least 2% of average net profit (Rs. 24 lakhs) is mandatory.

C CSR is voluntary for all companies irrespective of thresholds.

D CSR expenditure must be exactly 5% of profit.

E CSR applies only if company is a public sector undertaking.

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