The document summarizes the key aspects of the Corporate Social Responsibilities of Companies Act 2013 in India, including that it was passed in 2013 and mandates that companies meeting certain criteria must spend 2% of their net profits on social responsibility activities related to areas like poverty, education, and the environment. Eligible companies must have a net worth over 500 crore INR, turnover over 1000 crore INR, and net profit over 5 crore INR. The Act requires these companies to form a CSR committee to determine policy and activities, for the board to approve spending and ensure implementation, and to disclose reasons for any lack of spending.

1. Corporate Social
Responsibilities
of Companies Act,
2013
By,
KHARMATHIE A R

2. INTRODUCTION
▪ Passed on 29th August 2013 (both the houses)
▪ Concept of CSR is governed in clause 135
▪ Mandatory for certain category of companies
▪ Effect from 2014-15 (fiscal year)
▪ INDIA is first to implement

3. ELEGIBILTY [SEC 135(1)]
▪ Three or more directors with at least one
independent director.
Net worth > 500 Crores INR
Turnover > 1000 Crores INR
Net Profit > 5 Crores INR

4. BOARD’S REPORT
[ SEC 135 (2) ]
▪ Section 134(3)(o) disclose the composition of CSR Committee
▪ “The details about the policy developed and implemented by
the company on corporate social responsibility initiatives
taken during the year”

5. CSR COMMITTEE
[ SEC135(3) ]
▪ Formulate and recommendCSR Policy to the Board
▪ Recommend activities and amount of expenditure to be
incurred.
▪ Monitor the CSR policy from time to time

6. ROLE OF BOARD
[SEC 135(4)]
▪ Form a CSR Committee
▪ Approve the CSR policy
▪ Disclose reasons for not spending the amount (if applicable)
▪ Ensure implementation of the activities under CSR

7. CSR SPENDING
[ SEC 135 (5) ]
▪ Ensure 2% average Net Profit spend
▪ 3 immediately preceding FY, CSR Policy
▪ Preference to be local area or areas, CSR activities( Schedule
VII)
▪ Failure of spending
- board’s report
- section 134(3)(o)