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CS Professional · CSR and Social Governance · Corporate Social Responsibility

Veda Textiles Ltd, an eligible company, finds on 31 March that Rs 40 lakh of its CSR obligation for the year is unspent. The amount relates to a multi-year ongoing project that meets the prescribed conditions. Within what period from the end of the financial year must the company transfer it, and to where?

Unspent CSR money tied to an ongoing project must be transferred within thirty days from the end of the financial year to the Unspent Corporate Social Responsibility Account in a scheduled bank. The six-month Schedule VII Fund route applies only to non-ongoing project amounts.

  1. AWithin thirty days, to the Unspent Corporate Social Responsibility Account in a scheduled bankCorrect
  2. BWithin six months, to a Fund specified in Schedule VII
  3. CWithin thirty days, to a Fund specified in Schedule VII
  4. DWithin three financial years, to the Unspent Corporate Social Responsibility Account

Explanation

Under section 135(6), unspent money relating to an ongoing project must be moved within thirty days of the year end to a special Unspent CSR Account in a scheduled bank. The six-month transfer to a Schedule VII Fund applies only where the unspent amount does not relate to an ongoing project. The three-year period is the time allowed to spend the money, not to transfer it.

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