The Ministry of Corporate Affairs (MCA) has tightened its oversight on corporate India’s CSR compliance by shortening the window for filing the CSR return with the government.
Corporates have now been mandated to file their CSR return (CSR-2) for 2023-24 by December 31, 2024. This has to be filed separately independent of AOC-4, which is the annual return form to be filed within 30 days of an AGM (annual general meeting).
For the earlier fiscal 2022-23, corporates were allowed to file the CSR return (CSR-2) till March 31, 2024.
Company law experts highlight that there have been cases where the CSR numbers exhibited in financial statements (in AOC 4) do not match with the subsequent figures posted in CSR return (CSR-2).
Anjali Jain, Partner, Areness, a law firm, said, this MCA notification would help the regulator (government) analyse and assess such malpractices, considering a lower window for such compliance is introduced.
Manmeet Kaur, Partner - Karanjawala & co, said, “making CSR filing under standalone form will bring transparency and accuracy with regard to CSR activities as companies needs to maintain records/data for both AOC-4 and CSR-2 filing separately”.
Kaur noted that the Companies (Accounts) Rules, 2014, were amended in 2022 to mandate that CSR-2 must also be filed as an addendum to AOC-4.
This requirement was subsequently amended in 2023 whereby a separate CSR-2 was to be filed (before March 31, 2024) after filing of the AOC-4 for FY22-23.
The latest amendment prescribes separate filing of form CSR-2 for FY23-24 (after filing of AOC-4) before December 31, 2024, Kaur added.
Vanita Bhargava, Partner at Khaitan & Co, said that Form CSR-2 was introduced in 2022 in which the companies are required to report details regarding their CSR initiatives such as details of projects undertaken, CSR committee, CSR spending and unspent CSR funds among other.
“This (latest MCA notification) helps to ensure transparency and provides a way to determine whether the companies are fulfilling regulatory requirements pertaining to CSR”, Bhargava said.
“The latest MCA move seems to be a step moving towards the originally intended timeline for submission of the Form CSR-2 which is within 30 days of the company’s AGM along with the Form AOC–4”.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.