Current Affairs · Corporate Laws and Regulations
Under the regulatory framework for Corporate Social Responsibility (CSR) in India, if a company spends an amount in excess of the mandatory 2 percent requirement in a financial year, it is allowed to set off such excess amount against the CSR spending requirement in the succeeding financial years. Based on these provisions, which of the following is the most appropriate action for a company that has spent 1.5 crore rupees in excess of its 2 percent requirement during the financial year?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The company can immediately claim a tax deduction for this 1.5 crore rupees as a business expense under the Income Tax Act.
- 2The company can carry forward this excess and reduce its CSR obligation for the succeeding three financial years after passing a board resolution.✓
- 3The company must treat the 1.5 crore rupees as a mandatory donation to a political party to avoid legal complications.
- 4The company is required to surrender the excess amount to the Reserve Bank of India as part of the National Stabilisation Fund.
Correct answer
The company can carry forward this excess and reduce its CSR obligation for the succeeding three financial years after passing a board resolution.
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