Pratham Ltd had a net profit of ₹6 crore in the immediately preceding financial year, although its net worth and turnover did not cross the other statutory thresholds. Which statement correctly describes its obligation under section 135 of the Companies Act, 2013?

Section 135(1) of the Companies Act, 2013 applies the CSR regime to a company having a net worth of ₹500 crore or more, or a turnover of ₹1,000 crore or more, or a net profit of ₹5 crore or more in the immediately preceding financial year. Because the three limbs are connected by the word 'or', crossing even one threshold attracts the obligation, and a net profit of ₹6 crore therefore brings Pratham Ltd within the provision. Section 135(5) then requires the company to spend, in every financial year, at least 2% of its average net profits of the three immediately preceding financial years on CSR activities. Options stating that all thresholds must be crossed, that the spend is computed on net worth, or that CSR applies only to listed companies are therefore incorrect.