03 March 2014
Sec 135 stay that if company having: 1.Net worth of Rs. 500 Crore Or 2.Turnover of Rs. 1000 Crore Or 3.Net profit of Rs. 5 Crore During any financial year
Now my query is what does “any financial year” means.
In the financial year 2007-08 company has Rs.5.82 crore net profit and after that companies profit was between Rs.2 to Rs.3 crore only.
03 March 2014
1. As per Section 135(1) if the prescribed condition is fulfilled in ANY year, the Section 135 is applicable.
However, Rule 3(2) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 provides that a company which ceases to fulfill conditions of Section 135(1) for 3 CONSECUTIVE YEARS shall not be required to comply with CSR.
2. In your case, the profit for the last 3 financial years is LESS than Rs. 5 crore, so CSR is NOT applicable (assuming the net worth & turnover are less than the prescribed limit).
CAclubindia
