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As of November 2026, a company required to form a committee under section 135 of the Companies Act,…

Under section 135(3), the Corporate Social Responsibility Committee formulates the policy, indicating the Schedule VII activities to be undertaken, and recommends it to the…

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As of November 2026, a company required to form a committee under section 135 of the Companies Act, 2013 must spend, in every financial year, at least 2% of its average net profit on activities listed in Schedule VII, in pursuance of a policy approved by its Board. The average is taken over the three immediately preceding financial years or, if the company has completed fewer than three, over the preceding financial years since its incorporation. Which committee recommends that policy to the Board?

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Correct answer D

Under section 135(3), the Corporate Social Responsibility Committee formulates the policy, indicating the Schedule VII activities to be undertaken, and recommends it to the Board. The Board approves the policy and ensures the required spending. The Audit Committee, the Nomination and Remuneration Committee and the Stakeholders Relationship Committee are formed under sections 177 and 178 for other functions.

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