There is case in which a pvt company is exceeding its profit by 5 crores in current financial year, So company has to constitute CSR committe of 3 or more directors out of which 1 should be independent director according to Sec 135 but for this company independent director provisions are not applicable as its a private limited company.
So, How to constitute CSR committe for this company?
Refer Rule 5 of Companies (CSR) Rules 2014:
CSR Committees
5. (1) The companies mentioned in rule 3 shall constitute CSR Committee as under.—
| (i) | an unlisted public company or a private company covered under sub-section (1) of section 135 which is not required to appoint an independent director pursuant to sub-section (4) of section 149 of the Act, shall have its CSR Committee without such director; | |
| (ii) | a private company having only two directors on its Board shall constitute its CSR Committee with two such directors; | |
| (iii) | with respect to a foreign company covered under these rules, the CSR Committee shall comprise of at least two persons of which one person shall be as specified under clause (d) of sub-section (1) of section 380 of the Act and another person shall be nominated by the foreign company. |
(2) The CSR Committee shall institute a transparent monitoring mechanism for implementation of the CSR projects or programs or activities undertaken by the company.
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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