Important Amedment in CSR Rules, 2014
Sec 135 of the Companies Act, 2013 makes CSR mandatory for companies with some threshold limits. There are some implications for startup private companies as well. Hence i wanted to discuss this amendment.
CSR Rules, 2014 has been amended Rule 4 via a notification on Jan 19.
The New amended rule conveys that a company can undertake CSR activity through either :-
- Company established under Sec 8 , by the company either singly or along with its holding or subsidiary or associate, or
- Company established under Sec 8 , by the company along with any other company or holding or associate company of such company.
Earlier, there was lot of ambiguity that any company can be formed to undertake CSR Activities. However, now CSR activities can be done only by forming Sec 8 companies ( i.e. Companies with charitable objects). We also have other routes like Registered trust/society prevailing even after amendment.