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CS Professional · CSR and Social Governance · Corporate Social Responsibility

Narmada Pharma Ltd had Rs 90 lakh unspent on an ongoing CSR project at the end of FY 2025-26 and transferred it to the Unspent CSR Account in a scheduled bank. Within what period must the amount be spent, failing which it goes to a Schedule VII Fund?

The amount must be spent within three financial years from the date of transfer to the Unspent CSR Account. If it is not, the company must transfer it to a Schedule VII Fund within thirty days from the date of completion of the third financial year.

  1. AThree financial years from the date of transferCorrect
  2. BOne financial year from the date of transfer
  3. CSix months from the end of the financial year
  4. DFive financial years from the date of transfer

Explanation

Under section 135(6), the amount in the Unspent CSR Account must be spent within three financial years from the date of transfer. If not, it must be moved to a Schedule VII Fund within thirty days of completion of the third financial year. Six months is the period for non-ongoing unspent amounts.

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