Contributions made by corporate towards Swachh Bharat Kosh and Clean Ganga Fund to be considered as social welfare spending under Companies Act
The government has widened the ambit of CSR under the new Companies Act to include contributions made towards the Swachh Bharat Kosh (SBK) and the Clean Ganga Fund (CGF).
The contributions will count as being made for social welfare work.
Changes to the Companies Act
Companies having at least Rs 5 cr net profit, or Rs 1,000 cr turnover, or Rs 500 cr net worth have to spend a minimum of 2% of their three year average annual net profit towards CSR from 2014-15. Schedule VII of Companies Act, 2013, lists the activities and endeavors that can count as CSR.
The Corporate Affairs Ministry has inserted the words ‘including contribution to the Swachh Bharat Kosh set up by the central government for the promotion of sanitation’ and ‘including contribution to the Swach Bharat Kosh set up by the central government for the promotion of sanitation’ in Schedule VII of the Act through a notification.
Earlier, contributions made to the Prime Minister’s National Relief Fund was also included under Schedule VII. Any other fund set up by the Central Government for socio-economic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women was also included under the schedule.
Swachh Bharat Kosh (SBK)
SBK was set up to attract CSR funds from the corporate sector and contributions from individuals and philanthropists. The funds accumulated in the SBK will be utilized to achieve the objective of Clean India or Swachh Bharat by 2019 through Swachh Bharat Mission.
Clean Ganga Fund (CGF)
The CGF was constituted to fund activities to clean and conserve the river, Ganga. The CGF also accepts voluntary contributions from NRIs and PIOs towards the CGF
The CGF will be managed by a Trust to be headed by the finance minister. The Secretariat of the Trust will be set up in the Ministry of Water Resources.
Categories: Business & Economy Current Affairs 2017