Legal Question in Business Law in India

02.12.2012

Dear Sir / Madam,

The Companies Bill of 2009 and the latest Companies Bill of 2011 mandates that Companies falling in a certain category allocate at least 2% of their average profits over the previous three years to corporate social responsibility initiatives.

These initiatives can include, among others

(i) eradicating extreme hunger and poverty;

(ii) promotion of education;

(iii) promoting gender equality and empowering women;

(iv) reducing child mortality and improving maternal health;

(v) combating the human immunodeficiency virus, acquired immune deficiency syndrome, malaria and other diseases;

(vi) ensuring environmental sustainability;

(vii) employment enhancing vocational skills;

(viii) social business projects;

(ix) contribution to the Prime Minister's National Relief Fund or any other fund set up by the Central Government or the State Governments for socioeconomic development and relief and funds for the welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women.

Mention of the same also needs to be done in the Annual Report of the Company.

Regards,

FCA Prashant Chavan

Mumbai

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