No need for separate disclosure on setting up ICC: MCA


With Women and Child Development Ministry seeking mandatory disclosure on Internal Complaint Committee by companies to address sexual harassment cases, the Corporate Affairs Ministry has said a separate requirement is not required in this regard under the Companies Act.

The WCD Ministry had requested the Corporate Affairs Ministry to consider a mandatory disclosure in the directors' report of a company about constituting the ICC.

"In view of the fact that the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 exclusively provides for all aspects with respect to matters of sexual harassments, including for disclosure on compliances, a separate requirement under the Companies Act, 2013 was not considered necessary," Corporate Affairs Minister Arun Jaitley said in a written reply to Lok Sabha.

He also noted that a subsequent response has been received from the Women and Child Development (WCD) Ministry.

The Ministry of Corporate Affairs ( MCA) is implementing the Companies Act, 2013.

In another written reply, Jaitley said the government has no role to play in monitoring expenditure made by companies towards CSR activities.

Under the new companies law, certain class of profitable entities are required to shell out at least two per cent of their three-year annual average net profit towards CSR activities. The norms came into force from April 1, 2014.

"The responsibility of monitoring the activities and utilisation of CSR funds by the companies under CSR is vested with the board of the company under the Act. Government has no role to play in this regard," the Minister said.

Companies having a turnover of at least Rs 1,000 crore or minimum networth of Rs 500 crore or net profit of Rs 5 crore are required to spend two per cent of their average net profit earned in the last three financial years have to comply with the CSR norm.

"There are no specific tax exemption/concessions to companies under the Income Tax Act, 1961 for expenditure incurred by companies towards CSR," Jaitley said in another written reply.

However, spending by companies on activities such as rural development and contribution to the Prime Minister's National Relief Fund that "find a place in Schedule VII of the Companies Act, 2013, may qualify for tax exemptions under relevant provisions of Income Tax Act, 1961 subject to fulfilment of any specified conditions," he noted.

Source :-