RHI Magnesita India Channels Rs. 2.04 Cr into CSR Activities, Commits Residual Rs. 1.88 Cr to PM CARES Fund
NEW DELHI (India CSR): The annual report of the RHI Magnesita India Limited for the financial year ending 31st March 2022, revealed that it was able to allocate Rs. 203.84 lacs towards its defined Corporate Social Responsibility (CSR) commitments. However, an unspent amount of Rs. 187.68 lacs was left over due to operational challenges faced during the initial phase of the year.
RHI Magnesita India is the foremost provider of premium refractory products, systems, and solutions essential for a diverse range of industries such as steel, cement, non-ferrous metals, and glass, where high-temperature processes surpassing 1,200°C are crucial.
The company faced penalties for not spending the mandated amount on CSR – Corporate Social Responsibility activities, failing to transfer unspent CSR funds within the required timeframe, and responding slowly to regulatory requirements. (Read Full Report: Top 3 Reasons Why RHI Magnesita India Penalized For CSR Non-compliance)
The report indicates that the company faced significant hurdles in keeping its operations running smoothly, as several of its officials contracted Covid-19. This situation led to a delay in due diligence and other related activities pertaining to the identification of potential CSR projects and beneficiaries.
However, in line with its commitment to societal welfare and in compliance with regulatory guidelines, the company ensured that the remaining Rs. 187.68 lacs were not left idle. This amount was promptly deposited within the prescribed timelines into the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund), a national initiative providing support during emergency situations.
Despite the unprecedented challenges, the company’s focus on its CSR obligations and its contribution to the PM CARES Fund underscore its commitment to the community and the nation at large.
Reasons for Non-compliance with 2% CSR Spending
The reasons the Company failed to spend 2% of the average Net Profit as per Section 135(5):
The company annual report said, “The Company was able to spend Rs. 203.84 lacs towards its identified CSR obligations and an amount of Rs. 187.68 lacs remained unspent as on 31 March 2022, since in the initial period of the financial year several officials of the Company were infected and it was difficult for the Company to keep its operations running and management was focused on ensuring the smooth functioning of the business which leads to pending due diligence and related matters for identifying potential CSR projects/beneficiaries though the said unspent amount of Rs. 187.68 lacs has been deposited in Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) within prescribed timelines.”
“The unspent CSR expenditure of Rs. 135.40 Lacs for the year ended 31 March 2021 was transferred by the Company to the funds prescribed under Schedule VII of the Companies Act 2013 after the due date and an application for compounding of offence in this regard has been filed by the Company with the appropriate authorities.”, the report added.
List of Organisation benefiting from CSR Fund
| Company | CSR Project | Location | Amount (in Lakhs) |
|---|---|---|---|
| 1 | Donation to Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund | PAN India | 40.00 |
| 2 | Contribution to Venkatapuram Rural Development Trust | Andhra Pradesh Visakhapatnam | 12.00 |
| 3 | Free health checkup camp | Rajasthan Alwar | 18.61 |
| 4 | Maintenance of ambulance donated to a trust | Rajasthan Alwar | 14.79 |
| 5 | Contribution to Southeast Asia Institute of Thalassemia for treatment | Rajasthan Jaipur | 10.00 |
| 6 | COVID-19 Expenses | Vicinity of plants | 49.12 |
| 7 | Rotary Club of Bhiwadi – Shakti | Rajasthan Bhiwadi | 1.56 |
| 8 | Contribution for various educational activities | Vicinity of plants | 8.08 |
| 9 | Making available safe drinking water | Andhra Pradesh Visakhapatnam | 1.03 |
| 10 | The Earth Saviours Foundation | Haryana | 21.00 |
| 11 | Contribution for water preservation & conservation | Rajasthan | 4.24 |
| 12 | Disaster management expenses towards cyclone victims | Orissa | 0.12 |
| 13 | Renovation of Community Center Hall | Odisha Cuttack | 3.00 |
Explanation: The table presents a list of companies along with their CSR projects and corresponding CSR amounts. It also includes information on the location of the project and whether there is a contribution to any other fund or foundation.
Details of CSR amount spent against ongoing projects for the financial year: NIL
CSR Amount Spent or Unspent for the Financial Year 2021-22
Explaining the table provides a breakdown of the CSR amount spent or unspent for the financial year.
- The total amount spent during the financial year is Rs. 187.68 Lacs.
- An amount of Rs. 203.84 Lacs has been transferred to the Unspent CSR Account as per section 135(6).
- The table also indicates any amounts transferred to specific funds specified under Schedule VII as per the second proviso to section 135(5). In this case, there were two transfers:
- An amount of Rs. 100 Lakhs was transferred to the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund on 23 June 2022.
- An amount of Rs. 90 Lakhs was transferred to a fund on 12 July 2022. The name of the fund is not specified in the provided information.
Average Net Profit and Total CSR Obligation Breakdown
| Category | Amount (in Lacs) | |
|---|---|---|
| 7a | The amount required to be set off for the financial year, if any. | 391.52 |
| 7b | Surplus arising out of the CSR projects or programmes or activities of the previous financial years | 0.00 |
| 7c | Surplus arising out of the CSR projects or programs or activities of the previous financial years | 0.00 |
| 7d | Total CSR obligation for the financial year (7a + 7b – 7c) | 391.52 |
CSR Policy of RHI Magnesita India Limited
RHI Magnesita India Limited aims to establish guidelines regarding charitable contributions and Sponsorship with regard to Corporate Social Responsibility. RHIM prohibits any direct or indirect contributions that are made to influence a decision impacting RHIM India’s business activity.
The Company is committed to sustainable development, active contribution to the Social, Economic and Environmental Development of the Community and inclusive growth. The Company’s success depends on the communities in which we live and work; our business can only be sustainable if we are supporting thriving communities.
The company works with local community leaders, government and NGOs on environmental and social issues of concern.
CSR initiatives undertaken by the Company uphold the principles of a responsible corporate citizen and aim to distribute the economic benefits derived by it through active collaboration with credible institutions by contributing to the social and economic development of the communities in which it operates.
The Company pursues CSR activities in accordance with Schedule VII of the Companies Act, 2013. The focus areas for spending the funds earmarked for
CSR activities are to support the health, education, wellness, water, sanitation and hygiene needs of communities, especially those who are marginalized.
RHIM also supports conservation and relief efforts for communities at the time of natural and man-made disasters.
Who are the members of the CSR Committee of RHI Magnesita India Limited
| Sr. No. | Name of Director, Designation | Nature of Directorship | No. of Meetings of the CSR Committee held during the year | No. of Meetings of the CSR Committee attended during the year |
|---|---|---|---|---|
| i. | Sonu Chadha, Chairperson | Non-Executive, Independent | 2 | 2 |
| ii. | Erwin Jankovits, Member | Non-Executive | 2 | 2 |
| iii. | Parmod Sagar, Member | Executive | 2 | 2 |
