The ministry of Corporate Affairs Clarified the Categories for CSR Activities

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NEW DELHI: The ministry of corporate affairs issued some clarifications in response to queries from stakeholders and made it clear that slum-redevelopment, road safety awareness and consumer protection services will be treated as Corporate Social Responsibility (CSR) activities.

BJP’s election manifesto shouted loud and clear ‘’housing for all by 2022’’. The ministry, in a circular, has clarified that slum-redevelopment or housing for economically weaker sections could be covered under the eligible CSR category of ‘measures taken for reducing inequalities faced by socially and economically backward groups’.
Road safety has been a major concern in India with increasing accidents and deaths. Activities relating to road safety promotion, are also likely to get a major thrust as the ministry has clarified these would also be treated as eligible CSR activities.

If any company chooses to use print, audio and visual media to promote road safety awareness, then it would qualify as a CSR activity under the broad heading of ‘promoting education‘. Companies may choose to provide training to drivers which would fall under ‘promoting vocational skills’ and social projects like giving medical and legal aid, treatment to road accident victims would fall under the eligible category of ‘promoting health care‘.
Any project meant for development of rural India will be treated as a ‘rural development’ project and will be an eligible CSR activity.

The CSR provisions contained in The Companies Act, 2014 are required to spend 2% of their average net profit of the last three years on CSR activities and hence this directive was sought by the companies to avoid non-compliance.

[Source- The Times of India]

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