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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Corporate Social Responsibility (CSR)

Kaveri Textiles Ltd has an ongoing CSR project for which Rs 80 lakh remained unspent at the end of FY 2025-26, on 31 March 2026. Under section 135(6), what must the company do with this amount?

Kaveri must transfer the Rs 80 lakh to a special Unspent CSR Account in a scheduled bank within thirty days from the end of the financial year. The six-month Fund route applies only to unspent amounts not relating to ongoing projects.

  1. ATransfer it to a Schedule VII Fund within six months
  2. BTransfer it within thirty days from the end of the financial year to the Unspent CSR Account in a scheduled bankCorrect
  3. CCarry it in the books as a reserve with no separate account
  4. DTransfer it to the Unspent CSR Account within three financial years

Explanation

Section 135(6) requires the unspent amount of an ongoing project to be moved within thirty days of year end to the Unspent Corporate Social Responsibility Account in a scheduled bank. The six-month Fund transfer is for non-ongoing shortfalls, so it is wrong here.

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