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TMI Blog2020 (7) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... State of Tarnilnadu to National Capital of Delhi and again changed it from state of Haryana to state of Karnataka. The Registered office of the Company is situated at Level 9, Navigator International Tech Park, Whitefield Road, Bangalore 560 066. Its Authorised Share Capital is Rs. 70,05,00,000/- (Rupees Seventy Crore and Five Lakh Only) divided into 5,60,50,000/- (Rupees Five Crore Sixty Five Lakh and Fifty Thousand only) equity shares of Rs. 10/- and Rs. 1,40,00,000/- (Rupees One Crore Forty Lakhs only) Compulsorily Convertible Preference Shares of Rs. 10/- each. The Paid-up Capital as on 31st March 2018 is Rs. 17,36,54,180/-(Rupees Seventeen Crore Thirty Six Lakh Fifty Four Thousand One Hundred and Eighty only). 2) The Company met the net profit criteria, U/ s 135 of the Companies Act, 2013, and had a Corporate Social Responsibility (CSR) committee. The Company has spent some amount as per the CSR Policy of the Company during the fiscal year 2017-18, which remain below the threshold mentioned in Section 135 (5) of Companies Act, 2013 r/ w Companies Rules, 2014. Due to human lapse, the concerned department misreported the amounts spent on CSR, which mentioned in the CSR Annexu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d has corporate social Responsibility (CSR) committee only with one member in the year 2017-18 which is below the statutory requirement specified in the section. The Company spent "some amount as per the CSR policy of the Company during the fiscal year 2017-18 which remained below the threshold mentioned in Sec. 135(5) of the Companies Act, 2013 r/ w Companies (Corporate Social Responsibility Policy) Rules, 2014. The Company did not specifically stated in Clause No. 6 of Annexure 4 attached to the Directors' report for the year 2017-18 with regard to the reasons for non-spending of due CSR amount. 2) As per Section 131 (2) of the Companies Act, 2013 "Where copies of the previous financial statement or report have been sent out to members or delivered to the Registrar or laid before the company in general meeting, the revisions must be confined to-- a. The correction in respect of which the previous financial statement or report do not comply with the provisions of Section 129 or section 134; and b. The making of any necessary consequential alternation". In terms of above section, Revision must be confined only to correction of accounts and not for making the offence goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to the said observations by inter alia stating as follows (a) The financial statement includes, amongst others, explanatory note annexed to, or forming part of any documents referred to in sub-clause (i) to sub-clause(iv) of s. 2 (40) of the Companies Act, 2013 (hereinafter the Act). Pursuant to s. 134 (2) and 134(3) of the Act, the auditor's report and the Directors report respectively are required to be attached to the financial statement. The Company will file the financial statement along with revised Directors' report after receiving approval of this Hon'ble Bench. The Company is required to file its financial statement in the extended business reporting language in which, among others amount of CSR expenditure has to be disclosed. In view of the mismatch of CSR expenses in the CSR annexure to the directors' report with the amount stated in the financial statement, which was discovered during the pre-scrutiny stage, the application was made before this bench for revision of CSR annexure to the Director's report. (b) The Company has mentioned in the CSR annexure to the Directors report that after end of the fiscal year, Company has taken steps to co-op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Deputy Commissioner of Income-Tax, Bangalore, vide its letter bearing No. DCIT-C-7 (1) (1)/BLR/2019-2020 dated 19.09.2019, has inter alia stated as follows: (a) The contention of the assessee was verified with the financials and Income Tax Return submitted by the Assesse with the Department. The Assesse has filed the Income-Tax Return for A. Y 20181-9 on 30.11.2018. As per the return filed by the Assesse, the Assessee has claimed Rs. 3,80,240/- as amount spent on CSR under the head other expenses in Page 21 of ITR.. (b) It is pertinent to note that the amount spent on CSR is disallowable as per Explanation 2 of Sec. 37 (1) of the Income Tax Act. Hence the Assessee has disallowed the same in Computation of Income. The disallowance of CSR expense of Rs. 3,80,240/- is available in Page 29 of the Income Tax Return. Hence in net, the amount spent on CSR does not have an effect on Business Income and Income Tax payable as per Income Tax Act. (c) The Department this office does not have objection to the appeal filed by the Assessee Company. 6. Heard Mr. Naman G Joshi learned PCS for the Petitioner and Ms. Prema Hatti, learned Standing Counsel for ROC. We have carefully perused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to in clause (a); and (c) monitor the Corporate Social Responsibility Policy of the company from time to time. (4) The Board of every company referred to in sub-section (l) shall, (a) after taking into account the recommendations made by the Corporate Social Responsibility Committee, approve the Corporate Social Responsibility Policy for the company and disclose contents of such Policy in its report and also place it on the company's website, if any, in such manner as may be prescribed; and (b) ensure that the activities as are included in Corporate Social Responsibility Policy of the company are undertaken by the company. (5) The Board of every company referred to in sub-section (1), shall ensure that the company spends, in every financial year, at least two per cent. of the average net profits of the company made during the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility Policy: Provided that the company shall give preference to the local area and areas around it where it operates, for spending the amount earmarked for Corporate Social Responsibility activities: Provided further that if the company fails to spend su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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