General Circular 36 dated 17.09.2014

Clarification with regard to provisions of Corporate Social Responsibility(CSR) under section 135 of the Companies Act,2013.

MCA vide General Circular No. 36/2014dated September 17, 2014 has issued a clarification with regard to provisions of Corporate Social Responsibility (CSR) under section 135 of the Companies Act, 2013 which can be read as follows:

Rule 4(6) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 as notified on 27.02.2014 has been amended by Notiification G.S.R.__(E)

Consequently, clarification (iv) issued vide General Circular No. 21/2014dated 18.06.2014, stands omitted. 

Rule 4(6) as amended and clarification (iv) can be read in the text given below:

Rule 4(6) of the Companies (Corporate Social Responsibilty) Rules,2014 as amended : Companies may build CSR capacities of their own personnel as well as those of their Implementing agencies through Institutions with established track records of at least three financial years but such expenditure, including expenditure on administrative overheads shall not exceed five percent. of total CSR expenditure of the company in one financial year.

Clarification (iv) of General Circular No. 21 of 2014 Salaries paid by the companies to regular CSR staff as well as to volunteers of the  companies (in proportion to company’s time/hours spent specifically on CSR) can be  factored into CSR project cost as part of the CSR expenditure.