Finance Minister Arun Jaitley reported that corporate social responsibility projects are working successfully as over 75 percent amount has been spent in 2014-15. He also asked corporates to extend their helping hands to contribute to Prime Minister’s Relief fund which will be used during the natural calamities.
CSR cannot be spent for any political activity and if it is used in any such activities then it will not be considered as a legitimate CSR activity.
Jaitley mentioned that it is a successful experiment as over 75 percent of the amount allotted for CSR has been used. During 2014-15, the first year of CSR, 2 per cent profits of 460 companies comes to Rupees 8347.47 crore,of which 75.92 per cent has been spent for CSR activity during the year.
Companies which are not interested to spend their CSR amount can contribute to Prime Minister’s Relief Fund which will be used when the natural calamities occur. He mentioned that no CSR can be spent on political activities, Schedule VII of the Act clearly mentions 11 categories under which the CSR money can be spent. He also mentioned that during the first year of CSR, 79% expenditure was done by private corporates whereas 71% expenditure was done by the public enterprises. There are a total of 460 companies, of which 409 were private undertakings and 51 were public undertakings.
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He also reported that there is an in built mechanism, besides the committee which reviews the progress of implementation of CSR. It is monitored by the Corporate Affairs ministry and penal provisions are also there but the board of directors are equally responsible for checking if the CSR money is being spent properly.
Jaitley also said that 51 PSUs have spent 71.03% of their total 2% profits on CSR during the first year and the amount which has not been spent will be carried forward to the next year.