Bikash Agarwal (article assistant) (21 Points)
05 October 2017CAN A COMPANY DONATES ITS WHOLE NETWORTH TO A CHARITABLE TRUST IF THE SHAREHOLDERS PASSED SPECIAL RESOLUTION FOR THE SAME ?? IS THERE ANY LIABILITY ON DIRECTORS TO RECOMMEND SUCH A DONATION WHICH IS OVER AND ABOVE THE LIMIT OF 5% OF NETPROFIT.
Shrijay Sheth
(Co-Founder)
(2692 Points)
Replied 06 October 2017
Section 181 of the Act does not prescribe any limit for contribution to bona fide charitable and other funds. However, the limit is provided on power of Board for such contribution. It prescribes that prior permission of members in General Meeting is to be accorded when any amount the aggregate of which, in any financial year, exceed five percent of its average net profits for the three immediately preceding financial years.
CAclubindia
