The concept of CSR Registration was introduced in the Companies Act 2013 with enforcement of section 135 under the Act. Companies have certain responsibilities towards stakeholders including the society in which it operates. For this purpose, CSR-1 e-form is introduced to apply for CSR Registration.
Thus, a company which crosses the prescribed threshold is required to spend, in every financial year, at least 2% of the average net profits of the company made during the immediately preceding three financial years. These include companies that fulfill any of the following conditions:
£ Companies having net worth of ₹500 crore or more,
£ Turnover of ₹1000 crore or more,
£ Net Profit of ₹5 crore or more.
during the immediately preceding financial year. CSR funds can be utilized by companies which undertake CSR activities themselves or can be granted to NGOs which companies outsource their CSR activities to.
Eligibility for CSR-1 e-Form (CSR Registration):
£ The organization should be registered as a NGO under Section 8 companies or trusts or societies or an NGO established by the Central or State Government.
£ NGOs have conducted at least 3 years of permitted social activities.
£ NGO must be registered u/s 12A and 80G of the Income tax Act.
Benefits of CSR Registration:
£ Improved Public Image
£ Enhanced Goodwill of NGO.
£ No hassles in undertaking CSR activities.
£ Mitigate legal hurdles in securing funding from corporates.