• India CSR Awards 2025
  • Guest Posts
Saturday, June 21, 2025
  • Login
India CSR
  • Home
  • Corporate Social Responsibility
    • Art & Culture
    • CSR Leaders
    • Child Rights
    • Culture
    • Education
    • Gender Equality
    • Around the World
    • Skill Development
    • Safety
    • Covid-19
    • Safe Food For All
  • Sustainability
    • Sustainability Dialogues
    • Sustainability Knowledge Series
    • Plastics
    • Sustainable Development Goals
    • ESG
    • Circular Economy
    • BRSR
  • Corporate Governance
    • Diversity & Inclusion
  • Interviews
  • SDGs
    • No Poverty
    • Zero Hunger
    • Good Health & Well-Being
    • Quality Education
    • Gender Equality
    • Clean Water & Sanitation – SDG 6
    • Affordable & Clean Energy
    • Decent Work & Economic Growth
    • Industry, Innovation & Infrastructure
    • Reduced Inequalities
    • Sustainable Cities & Communities
    • Responsible Consumption & Production
    • Climate Action
    • Life Below Water
    • Life on Land
    • Peace, Justice & Strong Institutions
    • Partnerships for the Goals
  • Articles
  • Events
  • हिंदी
  • More
    • Business
    • Finance
    • Environment
    • Economy
    • Health
    • Around the World
    • Social Sector Leaders
    • Social Entrepreneurship
    • Trending News
      • Important Days
        • Festivals
      • Great People
      • Product Review
      • International
      • Sports
      • Entertainment
    • Case Studies
    • Philanthropy
    • Biography
    • Technology
    • Lifestyle
    • Sports
    • Gaming
    • Knowledge
    • Home Improvement
    • Words Power
    • Chief Ministers
No Result
View All Result
  • Home
  • Corporate Social Responsibility
    • Art & Culture
    • CSR Leaders
    • Child Rights
    • Culture
    • Education
    • Gender Equality
    • Around the World
    • Skill Development
    • Safety
    • Covid-19
    • Safe Food For All
  • Sustainability
    • Sustainability Dialogues
    • Sustainability Knowledge Series
    • Plastics
    • Sustainable Development Goals
    • ESG
    • Circular Economy
    • BRSR
  • Corporate Governance
    • Diversity & Inclusion
  • Interviews
  • SDGs
    • No Poverty
    • Zero Hunger
    • Good Health & Well-Being
    • Quality Education
    • Gender Equality
    • Clean Water & Sanitation – SDG 6
    • Affordable & Clean Energy
    • Decent Work & Economic Growth
    • Industry, Innovation & Infrastructure
    • Reduced Inequalities
    • Sustainable Cities & Communities
    • Responsible Consumption & Production
    • Climate Action
    • Life Below Water
    • Life on Land
    • Peace, Justice & Strong Institutions
    • Partnerships for the Goals
  • Articles
  • Events
  • हिंदी
  • More
    • Business
    • Finance
    • Environment
    • Economy
    • Health
    • Around the World
    • Social Sector Leaders
    • Social Entrepreneurship
    • Trending News
      • Important Days
        • Festivals
      • Great People
      • Product Review
      • International
      • Sports
      • Entertainment
    • Case Studies
    • Philanthropy
    • Biography
    • Technology
    • Lifestyle
    • Sports
    • Gaming
    • Knowledge
    • Home Improvement
    • Words Power
    • Chief Ministers
No Result
View All Result
India CSR
No Result
View All Result
Home Corporate Social Responsibility

GAAR’s Ruling on CSR Activities: A Crucial Verdict for Corporate India

As companies navigate this new landscape, the ruling could lead to a recalibration of CSR strategies, potentially reshaping the fabric of corporate social responsibility in India.

India CSR by India CSR
in Corporate Social Responsibility
Reading Time: 11 mins read
CSR in India and Corporate India
Share Share Share Share

Analyzing the Impact of GAAR’s Decision on CSR and GST

Rusen Kumar - Founder and Managing Editor of India CSR

NEW DELHI (India CSR): The Gujarat Authority for Advance Ruling (GAAR) has made a significant ruling regarding the eligibility of Input Tax Credit (ITC) on Corporate Social Responsibility (CSR) activities. This decision is pivotal as it addresses the complex intersection of CSR obligations under the Companies Act and the entitlements under the Goods and Services Tax (GST) laws. The ruling has profound implications for how businesses in India approach CSR expenditures and their tax implications.

Adama India Pvt Ltd vs. GAAR: Redefining Corporate Responsibility and Taxation in India

The Evolving Landscape of Corporate Obligations and Financial Duties

The legal tussle between Adama India Pvt Ltd and the Gujarat Authority for Advance Ruling (GAAR) transcends a mere tax dispute, reflecting the dynamic nature of corporate responsibilities and financial commitments in contemporary India. This landmark case promises to redraw the traditional boundaries that separate business expenditures from social responsibilities, potentially inaugurating a new era in corporate governance and tax policy in the nation.

With the unfolding of these legal proceedings, the corporate sector remains vigilant, keenly anticipating the far-reaching consequences this verdict might hold for the future of Corporate Social Responsibility (CSR) and taxation in India.

***

The Legal Framework

The legal framework surrounding CSR in India is unique. The Companies Act 2013 mandates certain companies to spend a percentage of their profits on CSR activities. This integration of CSR into legal obligations blurs the lines between voluntary social contributions and compulsory business expenditures.

***

GAAR’s Stance on CSR Activities

The Core Issue

Adama India Pvt Ltd, a leading agrochemical company, sought an advance ruling from GAAR on whether the inputs and input services procured for mandatory CSR activities, as required under the Companies Act 2013, would qualify as being in the course and furtherance of business and therefore eligible for ITC under the CGST Act.

GAAR’s Verdict

GAAR ruled that CSR activities, as outlined in the Companies (CSR Policy) Rules 2014, are excluded from the normal course of business of the applicant. Consequently, these activities are not eligible for ITC as per Section 16(1) of the CGST Act. GAAR’s decision is grounded in the interpretation that CSR, while mandatory, does not constitute a part of ‘business’ activities as per GST laws.

***

Copy of VerdictDownload

Implications of the Ruling

Legal and Financial Repercussions

This ruling implies that companies undertaking mandatory CSR activities will not be able to claim ITC on expenditures related to these activities. This interpretation could lead to a substantial financial impact on companies, especially those with significant CSR obligations.

Broader Corporate Impact

The decision also raises questions about the broader intent of CSR activities. If CSR expenses are not recognized for ITC, it might influence how companies choose and prioritize their CSR initiatives, potentially shifting focus away from non-business-aligned social activities.

Table of Important Facts:

FactDetails
AppellantAdama India Pvt Ltd
AuthorityGujarat Authority for Advance Ruling (GAAR)
IssueEligibility of ITC on CSR Activities
Relevant LawCompanies Act 2013, CSR Policy Rules 2014, CGST Act 2017
GAAR’s RulingCSR activities are not in the normal course of business and hence not eligible for ITC
ImplicationsCompanies cannot claim GST credits on CSR-related expenses
At many businesses, Corporate Social Responsibility (CSR) activities have been designed to put a smile on the faces of every individual it serves. Company contributes to developing the local communities in and around the areas where it does business.
Copyright@IndiaCSR&CartoonWatch

Impact on CSR Activities

There is also a concern about how such a ruling could impact the nature of CSR activities in India. If CSR expenditures are recognized for ITC, companies might be more inclined to undertake projects that align more closely with their business interests, potentially shifting the focus from pure philanthropy.

Setting a Precedent

This legal challenge by Adama India Pvt Ltd could set a significant precedent for how CSR expenses are treated under GST law. A ruling in favor of the company might encourage other businesses to claim ITC on their CSR spends, potentially leading to substantial changes in corporate financial strategies.


This legal challenge by Adama India Pvt Ltd could set a significant precedent for how CSR expenses are treated under GST law. A ruling in favor of the company might encourage other businesses to claim ITC on their CSR spends, potentially leading to substantial changes in corporate financial strategies.

Brief History of the Case Involving Adama India Pvt Ltd and GAAR

The case involving Adama India Pvt Ltd and the Gujarat Authority for Advance Ruling (GAAR) revolves around the eligibility of Input Tax Credit (ITC) for Corporate Social Responsibility (CSR) activities. Here’s a timeline detailing the key dates in this legal matter:

1. Advance Ruling Requested: Adama India Pvt Ltd approached GAAR seeking clarity on whether the expenses incurred on CSR activities, as mandated under the Companies Act 2013, were eligible for ITC under the GST framework. This request was formally noted as Advance Ruling No. GUJ/GAAR/R/114/2021.

2. Date of Advance Ruling: The initial ruling by GAAR was passed on 11.08.2021. This ruling determined that CSR activities, although mandatory, did not fall within the ‘course or furtherance of business’ for the purposes of GST, and thus were not eligible for ITC.

3. Appeal Filed by Adama India Pvt Ltd: Disagreeing with GAAR’s ruling, Adama India Pvt Ltd filed an appeal. The date of this appeal is recorded as 22.10.2021.

4. Personal Hearing Dates: The case progressed to the stage of personal hearings, which were crucial in the appeal process. The dates for these hearings were set for 06.01.2023 and 26.01.2023.


India CSR

Company Overview of Adama India Pvt Ltd

Based on the information provided in the attached document, here is a profile of Adama India Pvt Ltd:

Adama India Pvt Ltd is a key player in the agricultural sector, specializing in the supply of insecticides, fungicides, and herbicides. The company is headquartered in Bharuch, Gujarat, India, with its office located at Plot No. D-21/1, GIDC Estate, Dahej Tal-Vagra, Dahej, Bharuch-392130, Gujarat.

Corporate Social Responsibility (CSR)

Adama India Pvt Ltd is committed to fulfilling its CSR obligations as per Section 135 of the Companies Act 2013. The company has been actively involved in various CSR activities, including donations to government relief funds, educational societies, civil works, installation of plant and machinery in schools and hospitals, distribution of food kits, etc. These activities demonstrate the company’s commitment to contributing to societal development and welfare.

Legal Challenges

Adama India Pvt Ltd has been at the forefront of a significant legal challenge regarding the eligibility of Input Tax Credit (ITC) on CSR activities under the Central Goods and Services Tax Act 2017 (CGST Act). The company appealed against a ruling by the Gujarat Authority for Advance Ruling (GAAR), which stated that CSR activities, as per the Companies (CSR Policy) Rules 2014, are not in the normal course of business and therefore not eligible for ITC.

Financial and Tax Implications

This legal case has significant financial and tax implications for Adama India Pvt Ltd and the broader corporate sector in India. The company’s argument is that since CSR activities are a statutory requirement, they should be considered in the course and furtherance of business, thereby qualifying for ITC under the CGST Act. The outcome of this legal proceeding could potentially reshape corporate financial strategies and CSR activities in India.

Corporate Philosophy

Adama India Pvt Ltd’s approach to CSR and its legal challenge against the GAAR ruling reflect its philosophy of integrating social responsibility into its business model. The company believes in going beyond compliance to make a meaningful contribution to societal well-being and environmental stewardship.


An Overview of Gujarat Authority for Advance Ruling (GAAR)

The Gujarat Authority for Advance Ruling (GAAR) is a statutory body established under the Goods and Services Tax (GST) framework in India. It plays a crucial role in interpreting tax laws and providing clarity on various aspects of GST to taxpayers.

Function and Role

GAAR’s primary function is to give advance rulings on specific queries related to GST. These queries can be about the applicability of a tax rate, classification of goods and services, or admissibility of input tax credits. The authority’s rulings provide legal clarity and help businesses in tax planning and compliance.

Jurisdiction and Authority

GAAR operates within the state of Gujarat, addressing the queries and concerns of taxpayers registered or operating within the state. Its rulings are binding on the applicant and the jurisdictional tax authorities, regarding the specific case for which the ruling is sought.

Significant Decisions

GAAR has been involved in several important decisions that have shaped the interpretation and implementation of GST in Gujarat. One such notable ruling is the decision on the eligibility of Input Tax Credit (ITC) for CSR activities, which has had significant implications for businesses undertaking CSR initiatives.

Impact on Businesses

The decisions of GAAR have far-reaching implications on the business community. By providing advance rulings, GAAR assists businesses in understanding their tax liabilities and obligations better, ensuring compliance with GST laws.


You Learn

A New Paradigm for CSR and Taxation

GAAR’s ruling on the ineligibility of ITC for CSR activities marks a pivotal moment in the intersection of corporate responsibility and taxation in India. This decision not only impacts the financial strategies of companies but also prompts a re-evaluation of the role and nature of CSR activities in the corporate sector. As companies navigate this new landscape, the ruling could lead to a recalibration of CSR strategies, potentially reshaping the fabric of corporate social responsibility in India.

***

Rusen Kumar I India CSR
Rusen Kumar I India CSR

About the Author

Rusen Kumar is the Founder and Managing Editor of India CSR, a pioneering and largest knowledge dissemination platform focused on the domain of Corporate Sustainability and responsibility (CSR).

Copyright@IndiaCSR

Also Read

CSR
Tags: CSR in India

India CSR offers strategic corporate outreach opportunities to amplify your brand’s CSR, Sustainability, and ESG success stories.

📩 Contact us at: biz@indiacsr.in

Let’s collaborate to amplify your brand’s impact in the CSR and ESG ecosystem.

ADVERTISEMENT
India CSR

India CSR

India CSR is the largest media on CSR and sustainability offering diverse content across multisectoral issues on business responsibility. It covers Sustainable Development, Corporate Social Responsibility (CSR), Sustainability, and related issues in India. Founded in 2009, the organisation aspires to become a globally admired media that offers valuable information to its readers through responsible reporting.

Related Posts

हिन्दुस्तान जिंक द्वारा शिक्षा संबल कार्यक्रम के तहत् आयोजित समर कैंप में 1,500 अधिक विद्यार्थी लाभान्वित
Corporate Social Responsibility

CSR: Hindustan Zinc Wraps Up Shiksha Sambal Summer Camp, Empowers 1,500+ Students in Rajasthan

8 hours ago
0
INDIA CSR NEWS ANALYSIS
Corporate Social Responsibility

Jupiter Life Line Hospitals Invests Rs 4 Crore in CSR Initiatives for FY25

10 hours ago
0
INDIA CSR NEWS ANALYSIS
Corporate Social Responsibility

CARE Ratings Spent Over Rs 2 Crore on CSR in FY2025

11 hours ago
0
CSR: Muthoot Finance Pledges Rs 5 Cr for Rural Education, Opens School in Tamil Nadu
Corporate Social Responsibility

CSR: Muthoot Finance Pledges Rs 5 Cr for Rural Education, Opens School in Tamil Nadu

1 day ago
0
India Healthcare
Healthcare

India’s Healthcare Revolution: Affordable Care for All in 2025

1 day ago
0
INDIA CSR NEWS ANALYSIS
Corporate Social Responsibility

Alufluoride Invested Rs 50 lakh in CSR during FY 2025

1 day ago
0
CSR: Signify and MP Tourism Bring Light to 61 Villages
Corporate Social Responsibility

CSR: Signify and MP Tourism Bring Light to 61 Villages

2 days ago
0
Dalmia Bharat Foundation and Red Carpet Empower Women with Auto-Sector Skills
Corporate Social Responsibility

CSR: Dalmia Bharat Foundation and Red Carpet Empower Women with Auto-Sector Skills

3 days ago
0
HDFC Life, Digamber Capfin Expand Access to Life Insurance
Corporate Social Responsibility

HDFC Life, Digamber Capfin Expand Access to Life Insurance

3 days ago
0
Load More
Next Post
An image of the iPrep Learning Platform interface showcasing diverse learning content available in various regional languages, promoting inclusive education and accessibility.

Importance of Enabling Learning Content in Regional Languages through Digital

CSR

GAAR's Ruling on CSR: 5 Essential Facts Every Company Must Know

India CSR Awards India CSR Awards India CSR Awards
ADVERTISEMENT

LATEST NEWS

From Paycheck to Prosperity: How Smart Habits Pave Your Way to Financial Peace

CSR: Hindustan Zinc Wraps Up Shiksha Sambal Summer Camp, Empowers 1,500+ Students in Rajasthan

Political Parties Raise Rs. 7,445 Cr During 2024 Elections, BJP Accounts for Over 84%

हिन्दुस्तान जिंक द्वारा शिक्षा संबल कार्यक्रम के तहत् आयोजित समर कैंप में 1,500 अधिक विद्यार्थी लाभान्वित

Jupiter Life Line Hospitals Invests Rs 4 Crore in CSR Initiatives for FY25

CARE Ratings Spent Over Rs 2 Crore on CSR in FY2025

HZL HZL HZL
ADVERTISEMENT

TOP NEWS

वंदे गंगा जल संरक्षण – जन अभियान का शुभारंभ

Lodha Palava Sets Benchmark in Sustainable Water Management

Trent FY2025 Results: Rs 17,353 Cr Revenue (+37%), Rs 1,534 Cr PAT, 5% EBITDA

Top 10 Reasons to Rent a Water Purifier?

Bharat Seats CSR Spending Report of Rs 54 Lakhs for FY25

Political Parties Raise Rs. 7,445 Cr During 2024 Elections, BJP Accounts for Over 84%

Load More

Advertisement

Image Slider
content writing services Guest Post Top 5 Reasons to have Sponsored Posts at India CSR – India’s Largest CSR Media stem learning R2V2 Technologies Private Limited

Interviews

Himanshu Nivsarkar, Senior Executive Vice President and Head of CSR & ESG at Kotak Mahindra Bank
Interviews

Driving Sustainable Impact: An Interview with Himanshu Nivsarkar, Kotak Mahindra Bank

by India CSR
May 22, 2025
0

By Rusen Kumar NEW DELHI (India CSR): Himanshu Nivsarkar, Senior Executive Vice President and Head of CSR & ESG at Kotak...

Read moreDetails
Balamurugan Thevar, CSR Head at Shriram Finance

Empowering Women Drivers: An Interview with Balamurugan Thevar, CSR Head at Shriram Finance

May 20, 2025
0
N E Sridhar, the Chief Sustainability Officer at Titan Company Ltd.

Empowering Rural Craft Entrepreneurs: An Interview with N E Sridhar, Titan Company

May 15, 2025
0
Geetaj Channana, the Head of Corporate Strategy at Vivo India

Empowering Young Innovators Across India: An Interview with Geetaj Channana, the Head of Corporate Strategy at Vivo India

April 25, 2025
0
Load More
Facebook Twitter Youtube LinkedIn Instagram
India CSR Logo

India CSR is the largest tech-led platform for information on CSR and sustainability in India offering diverse content across multisectoral issues. It covers Sustainable Development, Corporate Social Responsibility (CSR), Sustainability, and related issues in India. Founded in 2009, the organisation aspires to become a globally admired media that offers valuable information to its readers through responsible reporting. To enjoy the premium services, we invite you to partner with us.

Follow us on social media:


Dear Valued Reader

India CSR is a free media platform that provides up-to-date information on CSR, Sustainability, ESG, and SDGs. They need reader support to continue delivering honest news. Donations of any amount are appreciated.

Help save India CSR.

Donate Now

donate at indiacsr

  • About India CSR
  • Team
  • India CSR Awards 2025
  • Partnership
  • Guest Posts
  • Services
  • Content Writing Services
  • Business Information
  • Contact
  • Privacy Policy
  • Terms of Use
  • Donate

Copyright © 2025 - India CSR | All Rights Reserved

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
No Result
View All Result
  • Home
  • Corporate Social Responsibility
    • Art & Culture
    • CSR Leaders
    • Child Rights
    • Culture
    • Education
    • Gender Equality
    • Around the World
    • Skill Development
    • Safety
    • Covid-19
    • Safe Food For All
  • Sustainability
    • Sustainability Dialogues
    • Sustainability Knowledge Series
    • Plastics
    • Sustainable Development Goals
    • ESG
    • Circular Economy
    • BRSR
  • Corporate Governance
    • Diversity & Inclusion
  • Interviews
  • SDGs
    • No Poverty
    • Zero Hunger
    • Good Health & Well-Being
    • Quality Education
    • Gender Equality
    • Clean Water & Sanitation – SDG 6
    • Affordable & Clean Energy
    • Decent Work & Economic Growth
    • Industry, Innovation & Infrastructure
    • Reduced Inequalities
    • Sustainable Cities & Communities
    • Responsible Consumption & Production
    • Climate Action
    • Life Below Water
    • Life on Land
    • Peace, Justice & Strong Institutions
    • Partnerships for the Goals
  • Articles
  • Events
  • हिंदी
  • More
    • Business
    • Finance
    • Environment
    • Economy
    • Health
    • Around the World
    • Social Sector Leaders
    • Social Entrepreneurship
    • Trending News
      • Important Days
      • Great People
      • Product Review
      • International
      • Sports
      • Entertainment
    • Case Studies
    • Philanthropy
    • Biography
    • Technology
    • Lifestyle
    • Sports
    • Gaming
    • Knowledge
    • Home Improvement
    • Words Power
    • Chief Ministers

Copyright © 2025 - India CSR | All Rights Reserved

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.