Lok Sabha Question No. 1196 (UNSTARRED), answered on 2025-07-28
Subject: Companies Penalised for non-Compliance of CSR
Ministry: CORPORATE AFFAIRS
Asked by: Smt. Geniben Nagaji Thakor, Shri Tanuj Punia, Shri Balwant Baswant Wankhade, Dr. Prashant Yadaorao Padole, Shri Benny Behanan, Shri Anto Antony, Shri Tangella Uday Srinivas, Shri K Sudhakaran

## GOVERNMENT OF INDIA

## MINISTRY OF CORPORATE AFFAIRS LOK SABHA

## UNSTARRED QUESTION NO. 1196

ANSWERED ON MONDAY, July 28, 2025/Sravana 6, 1947 (Saka)

## COMPANIES PENALISED FOR NON-COMPLIANCE OF CSR

## QUESTION

1196. SHRI K SUDHAKARAN:

SHRI TANUJ PUNIA:

SMT. GENIBEN NAGAJI THAKOR:

SHRI ANTO ANTONY:

SHRI TANGELLA UDAY SRINIVAS:

SHRI BENNY BEHANAN:

DR. PRASHANT YADAORAO PADOLE:

SHRI BALWANT BASWANT WANKHADE:

Will the Minister of CORPORATE AFFAIRS be pleased to state:

- (a) the number and total value of Corporate Social Responsibility (CSR) projects reported  as  unspent  or  non-compliance  during  the  last  three  years  including reasons for unspent funds and the nature of non-compliance, State-wise and yearwise; (b) the number of companies penalised for non-compliance under Section 135 of the Companies Act during the above period, along with the details of penalties imposed and the size or type of companies most frequently penalised, companywise; (c) whether any specific sectors or regions have shown recurring underperformance  in  CSR  compliance  and  if  so,  the  details  thereof  including potential causes and trends observed; (d) the measures taken by the Government or regulatory bodies to address CSR non-compliance including any policy changes or enforcement actions introduced during the last three years; (e)  whether  the  Government  has  undertaken  any  assessment  of  the  corporate Governance framework and if so, the key findings thereof along with the steps taken by the Government to strengthen Corporate Government and transparency

among registered companies in the country; and

- (f) the steps taken by the Government to strengthen the role and accountability of Independent  Directors,  Audit  Committees  and  Statutory  Auditors  including  any recent guidelines or proposed amendments?

c ontd….2/ -

## ANSWER

MINISTER OF STATE IN THE MINISTRY OF CORPORATE AFFAIRS   AND MINISTER OF STATE IN THE MINISTRY OF ROAD TRANSPORT AND HIGHWAYS

[SHRI HARSH MALHOTRA]

(a) to (d): The legal framework for Corporate Social Responsibility (CSR) has been provided under Section 135 of the Companies Act, 2013 ('Act'), Schedule VII of the Act and Companies (CSR Policy) Rules, 2014.  Schedule VII of the Act enlists areas or subjects that may be undertaken by a company as CSR. Every CSR mandated company having net worth of Rs. 500 crore or more or turnover of Rs. 1000 crore or more or net profit of Rs. 5 crore or more during immediately preceding financial year shall ensure that it spends, in every financial year, at least 2% of the average net profits of the company made during the three immediately financial years on the  activities  in  areas  or  subjects  specified  in  Schedule  VII  of  the  Act. CSR mandated  company  has  to  constitute  a  CSR  Committee.  The  Committee  shall formulate and recommend the CSR policy.

Under the Act, CSR is a Board driven process and the Board of the company is empowered to plan, decide, execute and monitor the CSR activities based on the recommendations of its CSR Committee. The existing legal provisions formation of CSR  committee, formulation of CSR  policy, Annual Action Plan on CSR, identification  of  the  project  and  area  in  which  project  will  be  implemented, certification of CSR expenditure by Chief Financial Officer (CFO) and audit of CSR expenditure by statutory auditors etc. provide adequate mechanisms to ensure transparency  and  accountability.  The  Board  has  to  ensure  that  the  approved amount has been spent on the assigned activity(ies). In case any amount remains unspent  then  such  amount  shall  be  transferred  in  the  designated  fund(s)  in Schedule VII in the prescribed time limit.   The Government does not issue any directions to Corporates to spend in any particular area or activity.

The Board of the company is required to disclose the CSR Policy implemented by the company in its Board report.  Rule 8 of the Companies (CSR Policy) Rules, 2014 contains  provisions  related  to  impact  assessment  of  CSR  projects  that  every company having average CSR obligation of 10 crore rupees or more in pursuance of sub-section (5) of section 135 of the Act, in the three immediately preceding financial  years,  shall  undertake  impact  assessment,  through  an  independent agency, of their CSR projects having outlays of one crore rupees or more, and which have been completed not less than one year before undertaking the impact study. The details of CSR activities, Impact Assessment etc. are required to be reported by the companies in the 'Annual Report on CSR' in cluding an annual action plan on CSR which is part of the Company's Board Report.

All  data  related  to  CSR  expenditure  filed  by  companies  in  MCA21  registry  is available in public domain at www.csr.gov.in. On the basis of annual filings made by companies in the MCA21 registry, the  Development Sector-wise and State-wise CSR expenditure for the last three  Financial Years i.e. FY 2021-22 to FY 2023-24 is  attached at Annexure-I and Annexure-II respectively.

Penal action is initiated as per provisions of the Act, following due process of law after examination of records and / or receipt of complaint against the companies and officers-in-default.  In  the  last  three  years  30  public  and  private  companies penalised and penalty amount of Rs.19.94 crore has been imposed.

(e): The Companies Act, 2013 and rules made thereunder contain adequate provisions for ensuring good corporate governance including through accountability, transparency, independent audit and role of Independent Directors, Committees of the Board etc. It provides for accountability to the Board of directors. The Act and Rules  require  that  the  companies  have  to  prepare  and  maintain  the  books  of account,  statutory  returns  and  registers  etc.  in  the  prescribed  format  their registered  office  and  to  comply  with  the  applicable  accounting  standards.  The disclosures  in  the  Board's  report  including  on  risk  management,  financial statements  and  annual  returns  have  also  been  mandated  to  ensure  that  every relevant information is available to the stakeholders as well as in the MCA21. The companies are required to file audited Annual Financial Statements, resolutions passed and statutory returns etc. with MCA21.  The Act also requires to appoint independent Directors and constitute various committees of the Board viz. Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee etc. for class of companies. The provisions of the Act are reviewed by the Government from time to time.

(f):  The Companies Act, 2013 and Rules made thereunder inter-alia, provides for role and accountability of Independent Directors, Audit Committee and Statutory Auditors.  These  provisions  are  aimed  at  ensuring  good  corporate  governance through representation and participation by Independent Directors on the Board of Directors  and  Audit  Committees.  The  role  of  the  Audit  Committee  includes examination of financial statements, auditor's report, related party transactions etc.   Further, the Companies Act, 2013 provides requirements for every company to appoint statutory auditors to carry out the audit of books of accounts of the company.

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## Refer to part (d) of Lok  Sabha Unstarred Question no. 1196 for 28.07.2025 Development Sector-wise CSR expenditure from FY 2021-22  to FY 2023-24

(Amount in Rupees Crore)

| Sl. No.                 | Development Sector                             | FY 2021-22   | FY 2022-23   | FY 2023-24   |
|-------------------------|------------------------------------------------|--------------|--------------|--------------|
| 1.                      | Agro forestry                                  | 35.52        | 67.28        | 74.47        |
| 2.                      | Animal welfare                                 | 174.35       | 325.44       | 531.14       |
| 3.                      | Armed Forces, Veterans, War Widows/ Dependants | 47.65        | 63.63        | 68.04        |
| 4.                      | Art and culture                                | 260.39       | 449.21       | 704.04       |
| 5.                      | Conservation of natural resources              | 274.90       | 584.65       | 423.47       |
| 6.                      | Education                                      | 6,719.89     | 10,414.93    | 12,134.57    |
| 7.                      | Environmental sustainability                   | 2,441.82     | 2,008.04     | 2,429.97     |
| 8.                      | Gender equality                                | 104.97       | 121.15       | 204.17       |
| 9.                      | Health care                                    | 8,049.49     | 7,023.60     | 7,150.81     |
| 10.                     | Livelihood enhancement projects                | 880.50       | 1,703.64     | 2,360.09     |
| 11.                     | Poverty, Eradicating Hunger, Malnutrition      | 1,903.78     | 1,282.73     | 1,233.93     |
| 12.                     | Rural development projects                     | 1,847.07     | 2,059.41     | 2,408.09     |
| 13.                     | Safe drinking water                            | 192.34       | 252.78       | 327.45       |
| 14.                     | Sanitation                                     | 314.53       | 438.81       | 375.23       |
| 15.                     | Senior Citizens Welfare                        | 80.34        | 153.91       | 159.82       |
| 16.                     | Setting up homes and hostels for women         | 101.00       | 49.50        | 41.80        |
| 17.                     | Setting up orphanage                           | 27.54        | 44.99        | 31.57        |
| 18.                     | Slum area development                          | 58.38        | 94.22        | 38.82        |
| 19.                     | Socio-economic equalities                      | 165.30       | 159.19       | 200.81       |
| 20.                     | Special education                              | 191.08       | 319.50       | 396.57       |
| 21.                     | Technology incubators                          | 8.57         | 1.48         | 1.91         |
| 22. Training to promote | sports                                         | 311.71       | 542.53       | 692.09       |
| 23.                     | Vocational skills                              | 1,053.80     | 1,206.75     | 1,396.55     |
| 24.                     | Women empowerment                              | 264.94       | 417.26       | 454.22       |
| 25.                     | Other Central Government Funds                 | 1,631.01     | 1,145.78     | 1,000.83     |
| 26.                     | NEC/Not mentioned*                             | 0.59         | 1.65         | 68.32        |
| Total                   |                                                | 27,141.45    | 30,932.08    | 34,908.75    |

(Data upto 31.03.2025) (Source: Corporate Data Management Cell)

* Companies either did not specify the names of sectors or indicated more than one sector where projects were undertaken.

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## Refer to part (d) of Lok Sabha Unstarred Question no. 1196 for 28.07.2025 State-wise CSR expenditure from FY 2021-22 to FY 2023-24

(Amount in Rupees Crore)

|   S.No. | States/ UTs                            | FY 2021-22   | FY 2022-23   | FY 2023-24   |
|---------|----------------------------------------|--------------|--------------|--------------|
|       1 | Andaman And Nicobar                    | 9.71         | 2.53         | 3.03         |
|       2 | Andhra Pradesh                         | 663.50       | 986.77       | 1,129.75     |
|       3 | Arunachal Pradesh                      | 119.42       | 13.36        | 39.57        |
|       4 | Assam                                  | 406.42       | 474.96       | 488.62       |
|       5 | Bihar                                  | 178.97       | 241.41       | 260.53       |
|       6 | Chandigarh                             | 51.19        | 18.44        | 113.31       |
|       7 | Chhattisgarh                           | 317.70       | 609.08       | 422.73       |
|       8 | Dadra and Nagar Haveli & Daman and Diu | 18.27        | 23.22        | 30.17        |
|       9 | Delhi                                  | 1,198.50     | 1,517.07     | 1,949.95     |
|      10 | Goa                                    | 45.43        | 60.91        | 85.79        |
|      11 | Gujarat                                | 1,613.18     | 2,060.02     | 2,707.54     |
|      12 | Haryana                                | 687.13       | 720.38       | 816.95       |
|      13 | Himachal Pradesh                       | 140.27       | 141.40       | 148.59       |
|      14 | Jammu and Kashmir                      | 50.68        | 72.19        | 98.54        |
|      15 | Jharkhand                              | 243.95       | 389.65       | 414.63       |
|      16 | Karnataka                              | 1,849.82     | 2,058.73     | 2,254.88     |
|      17 | Kerala                                 | 241.58       | 362.85       | 387.91       |
|      18 | Lakshadweep                            | 0.97         | 0.02         | 0.36         |
|      19 | Leh & Ladakh                           | 14.84        | 11.72        | 30.41        |
|      20 | Madhya Pradesh                         | 427.48       | 668.32       | 600.47       |
|      21 | Maharashtra                            | 5,407.40     | 5,705.54     | 6,065.95     |
|      22 | Manipur                                | 15.62        | 53.60        | 83.19        |
|      23 | Meghalaya                              | 19.63        | 22.94        | 30.94        |
|      24 | Mizoram                                | 6.94         | 11.01        | 4.48         |
|      25 | Nagaland                               | 12.46        | 13.57        | 15.41        |
|      26 | Odisha                                 | 752.37       | 994.82       | 1,389.39     |
|      27 | Puducherry                             | 9.31         | 14.29        | 32.68        |
|      28 | Punjab                                 | 185.41       | 263.51       | 351.89       |
|      29 | Rajasthan                              | 713.85       | 1,122.65     | 1,145.67     |
|      30 | Sikkim                                 | 28.24        | 36.18        | 41.87        |
|      31 | Tamil Nadu                             | 1,441.03     | 1,637.12     | 1,968.76     |
|      32 | Telangana                              | 688.58       | 1,040.61     | 1,054.92     |
|      33 | Tripura                                | 15.91        | 19.26        | 9.45         |
|      34 | Uttar Pradesh                          | 1,345.02     | 1,213.12     | 1,545.01     |
|      35 | Uttarakhand                            | 228.09       | 307.60       | 360.76       |
|      36 | West Bengal                            | 571.89       | 782.74       | 862.57       |
|      37 | PAN India*                             | 5,789.58     | 6,104.58     | 6,960.21     |
|      38 | PAN India (Other Centralized Funds)    | 1,631.01     | 1,145.78     | 1,000.83     |
|      39 | NEC/Not Mentioned*                     | 0.09         | 10.12        | 1.06         |
|      40 | Total                                  | 27,141.45    | 30,932.08    | 34,908.75    |

(Data upto 31.03.2025) (Source: Corporate Data Management Cell)

* Companies either did not specify the names of State/UT or indicated more than one State/Ut where projects were undertaken.

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