Clarifications on Spending of CSR Funds for COVID-19 Related Activities

The MCA had earlier clarified that spending of funds for COVID-19 is an eligible expenditure towards Corporate Social Responsibility (‘CSR’) activity (which was reported in our Client Alert dated March 30, 2020, accessible here). The MCA has now issued further clarifications by General Circulars dated April 22, 2021, and May 5, 2021 (collectively referred as ‘CSR Circulars’) stating that spending CSR funds on the following activities will be considered as eligible expenditure towards CSR activities under Schedule VII of the Companies Act: (i) setting up makeshift hospitals and temporary COVID care facilities (to be undertaken in consultation with State Governments, and in compliance with other applicable CSR-related requirements); (ii) creating health infrastructure for COVID care; (iii) establishment of medical oxygen generation and storage plants; (iv) manufacturing and supply of oxygen concentrators, ventilators, cylinders and other medical equipment for countering COVID-19; or (v) other activities similar to those in (ii) to (iv) above.

Published In:Inter Alia - Quarterly Edition - June 2021 [ English Chinese japanese ]
Date: June 30, 2021