The corporate affairs ministry, which is keeping a close tab on companies' compliance with the CSR provisions, had served show-cause notices to 1,018 defaulting entities.
After receiving reports from the Regional Directors (RDs) and Registrar of Companies
(RoCs), the ministry has now decided to initiate penal action against many entities.
"The ministry has accorded permission for initiating penal action under Section 134(8) of the Act for non- compliance... against 160 companies," Chaudhary told PTI in an interview.
The action is being taken for failing to comply with provisions of Section 135 — which pertains to CSR.
Among others, Section 134(8) provides for imposing a minimum fine of Rs 50,000 and the amount may go up to Rs 25 lakh for certain violations.
The penal action is being initiated with respect to non- compliance during the 2014-15 financial year.
According to data provided by the ministry earlier this year, as many as 12,431 companies had spent Rs 18,625 crore towards CSR activities during 2014-15 and 2015-16. Out of the total, 7,334 firms had shelled out Rs 8,803 crore in 2014-15.
According to Chaudhary, as far as spending the CSR amount is concerned, it is for the companies to decide.
"Earmarking of CSR funds of companies for any particular activity/ activities is beyond the purview of the Companies Act, 2013," and the boards of respective companies have been empowered under the law to take decisions with respect to allocation of such funds, the minister said.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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