CSR expenditure sees rise in FY 2019-20, Centre highlights companies' COVID-19 initiatives

In a written reply to Lok Sabha's question, on Monday, July 19, Minister of State for the Ministry of Corporate Affairs Rao Inderjit Singh stated that the corporate houses spent a huge sum on Corporate Social Responsibility (CSR) for the welfare of workers and local people in the country. He informed that Rs 21,231 crore was spent by 21,349 companies on CSR funds in 2019-20. 

Companies expenditure on various CSR activities

As per the details given by Inderjit Singh, the Ministry of Corporate Affairs (MCA) vide General Circular no.10/2020 dated 23.03.2020 clarified that CSR funds may be spent by companies for various COVID-19 related activities related under item nos. (i) and (xii) of Schedule VII of the Companies Act, 2013 (‘Act’). This is related to the promotion of healthcare, including preventive healthcare and sanitation, and disaster management.

Further, Ministry vide General Circular no.05/2021 dated 22.04.2021 and General Circular no.09/2021 dated 05.05.2021 clarified that the companies spent the CSR funds for setting up makeshift hospitals and temporary COVID care facilities. Some of the eligible CSR activities include 'creating health infrastructure for COVID care’, ‘establishment of medical oxygen generation and storage plants’, and ‘manufacturing and supply of oxygen concentrators, ventilators, cylinders and other medical equipment for countering COVID-19'. 

The minister informed that all data related to CSR filed by companies in the MCA21 registry is available in the public domain at www.csr.gov.in. 

Who is eligible to contribute towards CSR activities? 

The minister informed that Section 135 of the Companies Act, 2013 mandates every company having a net worth of Rs. 500 crore or more, or turnover of Rs. 1000 crore or more, or net profit of Rs 5 crore or more during the immediately preceding financial year to undertake Corporate Social Responsibility (CSR) activities. CSR is a Board-driven process and the Board of a Company is empowered to plan, decide, execute and monitor the CSR activities of the company based on the recommendation of its CSR Committee.

In addition, Inderjit said that as per the Act, for the ongoing financial year 2021-22, financial statements and board reports containing disclosure about CSR are required to be filed only after the end of the financial year. 

(With PIB input)

(Image credit: PTI)