New Delhi: Donations to the 'PM Cares' fund made in March 2020 that are over and above a company's corporate social responsibility (CSR) obligations for fiscal year 2020 can be set off against the subsequent year's spending obligations, subject to riders.
The corporate affairs ministry on Friday said in a clarification that the relief is available to donations made to the Prime Minister's Citizen Assistance and Relief in Emergency Situations (PM Cares) fund in response to an appeal made to companies last year.
The appeal was for contributing any unspent corporate social responsibility amount as well as any fund over and above the CSR spending obligations for fiscal year 2020.
The ministry said the contribution to the PM Cares fund in excess of FY20 corporate social responsibility obligations can be set off against the mandated CSR spending for a year 2021 after factoring in any unspent CSR amount for the previous years.
It said that for availing such a set-off facility, the chief financial officer of the company should certify that the donation was made by 31 March 2020 in response to the appeal.
It should also be certified by the statutory auditor of the company.
Another rider for availing this facility is that details of the contribution should be disclosed separately in the annual report on corporate social responsibility as well as in the board's report for FY21.
The clarification is significant as defaulting on corporate social responsibility spending obligations is punishable by a fine. The penalty provision that took effect on 22 January this year prescribes at least INR 1 crore for the defaulting company and at least INR 2 lakh for each defaulting officer.
Companies with a net worth of INR 500 crore or more, or a turnover of INR 1,000 crore or more, or a net profit of INR 5 crore or more, are required to spend 2% of their average net profit of the preceding three years on corporate social responsibility activities.
Read more: Click Here
You may like similar news
Covid jabs to be treated as CSR activity
The Corporate Affairs Ministry (MCA) has now allowed companies to spend their CSR funds for Covid va...
HDFC Bank commits Rs 100 crore towards COVID relief in FY22
MUMBAI: The country's largest private sector lender HDFC Bank on Friday committed Rs 100 crore for s...
NGO provides free oxygen supplies in MMR
An NGO has started providing free oxygen supplies in the Mumbai Metropolitan Region (MMR) through it...
NGO's ready-to-cook ration kits fight Covid-19 effect in tribal belts
With the Covid-19 pandemic and the resulting restrictions having brought daunting challenges for tri...
NGO Helps 600 Nomadic Tribal Families Get Food In Pandemic
Pune, 24th May 2021: In these tough times, everyone is doing their bit to take care of poor and reso...