Dear all
plz any one provide me information regarding Donation made by the Company.
SUDHANSHU SHARMA (PCS) (25 Points)
22 October 2010Dear all
plz any one provide me information regarding Donation made by the Company.
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 22 October 2010
Hi
Please read Section 293A of the Companies Act, 1956 on political contribution by Company.
Regards
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 22 October 2010
293A. Prohibitions and restrictions regarding political contributions
2[293A. Prohibitions and restrictions regarding political contributions
(1) Notwithstanding anything contained in any other provision of this Act:-
(a) no government company; and(2) A company, not being a company referred to in clause (a) or clause (b) of sub-section (1), may contribute any amount or amounts, directly or indirectly,-
(b) no other company which has been in existence for less than three financial years,
shall contribute any amount or amounts, directly or indirectly,-
(i) to any political party; or
(ii) for any political purpose to any person.
(a) to any political party; or(3) Without prejudice to the generality of the provisions of sub-sections (1) and (2)-
(b) for any political purpose to any person:
Provided that the amount or, as the case may be, the aggregate of the amounts which may be so contributed by a company in any financial year shall not exceed five per cent of its average net profits determined in accordance with the provisions of sections 349 and 350 during the three immediately preceding financial years :
Provided further that no such contribution shall be made by a company unless a resolution authorising the making of such contribution is passed at a meeting of the Board of Directors and such resolution shall, subject to the other provisions of this section, be deemed to be justification in law for the making and the acceptance of the contribution authorised by it.
Explanation.-Where a portion of a financial year of the company falls before the commencement of the Companies (Amendment) Act, 1985, and a portion falls after such commencement, the latter portion shall be deemed to be a financial year within the meaning and for the purposes, of this sub-section.
(a) a donation or subscripttion or payment caused to be given by a company on its behalf or on its account to a person who, to its knowledge, is carrying on any activity which, at the time at which such donation or subscripttion or payment was given or made, can reasonably be regarded as likely to effect public support for a political party shall also be deemed to be contribution of the amount of such donation, subscripttion or payment to such person for a political purpose;(4) Every company shall disclose in its profit and loss account any amount or amounts contributed by it to any political party or for any political purpose to any person during the financial year to which that account relates, giving particulars of the total amount contributed and the name of the party or person to which or to whom such amount has been contributed.
(b) the amount of expenditure incurred, directly or indirectly, by a company on advertisement in any publication (being a publication in the nature of a souvenir, brochure, tract, pamphlet or the like) by or on behalf of a political party or for its advantage shall also be deemed,-
(i) where such publication is by or on behalf of a political party, to be a contribution of such amount to such political party, and
(ii) where such publication is not by or on behalf of but for the advantage of a political party, to be a contribution for a political purpose to the person publishing it.
(5) If a company makes any contribution in contravention of the provisions of this section,-
(a) the company shall be punishable with fine which may extend to three times the amount so contributed; and
(b) every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to three years and shall also be liable to fine.]
3[Explanation.- For the purposes of this section, "political party" means a political party registered under section 29A of the Representation of the People Act, 1951 (43 of 1951)].
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 22 October 2010
293B. Power of Board and other persons to make contributions to the National Defence Fund, etc
1[293B. Power of Board and other persons to make contributions to the National Defence Fund, etc.
(1) The Board of directors of any company or any person or authority exercising the powers of the Board of directors of a company, or of the company in general meeting, may, notwithstanding anything contained in sections 293 and 293A or any other provision of this Act or in the memorandum, articles or any other instrument relating to the company, contribute such amount as it thinks fit to the National Defence Fund or any other Fund approved by the Central Government for the purpose of national defence.
(2) Every company shall disclose in its profits and loss account the total amount or amounts contributed by it to the Fund referred to in sub-section (1) during the financial year to which the amount relates.]
K Mohamed Ibrahim
(Company Secretary)
(104 Points)
Replied 27 October 2010
Please read Section 293(1)(e)
Suresh Prasad
(www.aubsp.com)
(15630 Points)
Replied 27 October 2010
Sec.581ZH : Donations or subscripttion by Producer Company
A Producer Company may, by special resolution, make donation or subscripttion to any institution or individual for the purposes of—
(a) promoting the social and economic welfare of Producer Members or producers general public; or
(b) promoting the mutual assistance principles:
Provided that the aggregate amount of all such donation and subscrip-tion in any financial year shall not exceed three per cent of the net profit of the Producer Company in the financial year immediately preceding the financial year in which the donation or subscripttion was made:
Provided further that no Producer Company shall make directly or indirectly to any political party or for any political purpose to any person any contribution or subscripttion or make available any facilities including personnel or material.
293A Prohibitions and restrictions regarding political contributions
As per sub sec. Clause (a) of Sec. 293A(3): Without prejudice to the generality of the provisions of sub-sections (1) and (2)-
a donation or subscripttion or payment caused to be given by a company on its behalf or on its account to a person who, to its knowledge, is carrying on any activity which, at the time at which such donation or subscripttion or payment was given or made, can reasonably be regarded as likely to effect public support for a political party shall also be deemed to be contribution of the amount of such donation, subscripttion or payment to such person for a political purpose.
Click on link:
https://www.mha.nic.in/fcra/intro/faqs.pdf
https://www.maheshwariandco.com/judgments/Company%20law/A%20Lakshmanswami%20Mudaliar%20v.%20LIC.pdf
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