Following is the financial information of MM Ltd., an Indian Company : FY Net profit/loss (in ₹ crores) 2022-23 4.50 2023-24 4.90 2024-25 6.70 The turnover for the FY 2024-25 is ₹980 crore and net worth is ₹450 crore. Ho

Provision of law; As per section 135(1) of the Companies Act 2013, the CSR provisions are applicable to companies which fulfils any of the following criteria:- Every company including its holding or subsidiary, and a foreign company having its branch office or project office in India having net worth of ₹500 crore or more, or turnover of ₹1000 crore or more or a net profit of ₹5 crore or more during the immediately preceding financial year. Rule 2(h) of the Companies (Corporate Social Responsibility Policy) Rules, 2014, any profits arising from any overseas branch of the company whether operated as a separate company or otherwise will not be included in profits of the company; Any dividend from other companies in India, which are covered under and complying with the provision of sec 135 of the Companies Act, 2013 will not be included in the profits of the company. Facts of the case: Since the Turnover for the FY 2024-25 was ₹980 crore and net worth is ₹450 crore, the company does not fulfil the turnover and net worth criteria as it is below the limit. However, during FY 2024-25, net profits will be recalculated because it included profits of overseas branch and dividend which is not allowed for computation of profit, hence revised amount of profit is calculated as below; Net profit = ₹6.70 crore Less profit of overseas branch = ₹1.50 crore Less dividend received from company specified above = ₹0.50 crore i.e. 6.70 - 1.50 - 0.50 = ₹4.70 crore. Conclusion: Since, profits of the FY 2024-25 is below the ₹5 crores. Hence, CSR is not applicable. Since CSR is not applicable, there is no need to make CSR provision.