WHAT IS CSR?

WHY DO WE NEED CSR ?

WHEN ARE WE ELEGIBLE FOR CSR?

CORPORATE SOCIAL RESPONSIBILITY [CSR] is a compliance requirement under section 135 of the Companies Act 2013. It refers to the voluntary contributions made by companies with an objective of improving the society and environmental conditions.

Now,

The provisions of CSR applies to every company that meets any of the following conditions in the preceding financial year

1. Net worth of more than Rs.500 crore

2. Turnover of more than Rs.1000 crore

3. Net profit of more than Rs.5 crore

If you have prepared the Balance Sheet for last year. and if the profits earned during the last year , whether under any head like Capital Gains, or from business or profession  , then

you ‘ARE ELIGIBLE’

for contributing to CSR , at least –

2% of the net profits made during the immediately preceding three financial years. 

(Note : If a company has been incorporated for a period of less than 3 years then they have to contribute 2% of its net profits made during the immediately preceding financial years .)

The penalty of not complying with the provisions of CSR are –

• The Company : Lower of the following –

  Fine up to Rs. 1 crore

  or 

  2 X The amount the company was required to transfer to the CSR fund
• The Officers in Default : 

   Lower of the following –

  Fine up to Rs. 2 lakh

  or

  1/10th of  the amount the company was required to transfer to the CSR fund.

  So, do pay CSR on time..