Quick Ltd. is a non-government company. Its Board of directors proposes to donate ₹70,000 to a political party. The average net profit worked out for the three immediately preceding financial years is ₹45,00,000. As a Co

Section 182 of the Companies Act, 2013 provides that a company, other than a Government company and a company which has been in existence for less than three financial years, may contribute any amount directly or indirectly to any political party: Provided that the amount or, as the case may be, the aggregate of the amount which may be so contributed by the company in any financial year shall not exceed seven and a half per cent of its average net profits during the three immediately preceding financial years. In the given case the average profit of the three immediately preceding financial years is ₹45,00,000 and the company can contribute maximum up to ₹3,37,500/- (7.5% of the ₹45,00,000). Since the amount proposed to be contributed is less than seven and half percent average net profits during the three immediately preceding financial years, the proposed donation is within the power of the board of directors of Quick Ltd. under the Companies Act, 2013.