Applicability of CSR Act for Utilize Trainees Fees Payment

[Pandiyan Perumal]

Dear Experts,

We are making payments to trainees like stifund and they are all not included in our payroll. So please guide me, shall we treat those expenses as CSR expenses.

[YAGAY andSUN]

Section 135 is relevant for Corporate Social Responsibility.

List of Permitted Activities To Be included in accordance with Schedule VII of the Companies Act, 2013

The Board shall ensure that the activities included by a company in its CSR Policy fall within the purview of the activities included is schedule VII. Some activities are specified in Schedule VII as the activities which may be included by companies in their Corporate Social Responsibility Policies. These activities are related to :

Sr.No	CSR Activities
1	abolishing poverty, malnourishment and hunger, improvising health care which includes preventive health care and sanitation and making available safe drinking water
2	improvement in education which includes special education and employment strengthening vocation skills among children, women, elderly and the differently abled and livelihood enhancement projects
3	improving gender equality, setting up homes and hostels for women and orphans
4	introducing the measures for reducing inequalities faced by socially and economically backward groups
5	Safeguarding environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agroforestry, conservation of natural resources and maintaining a quality of soil, air and water which also includes a contribution for rejuvenation of river Ganga
6	protection of national heritage, art and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional arts and handicrafts
7	areas for the advantage of skilled armed forces, war widows and their dependents
8	training to stimulate rural sports, nationally recognized sports, Paralympic sports and Olympic sports
9	contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Government for socio-economic development providing relief and welfare of the Scheduled Castes, the Scheduled and backward classes, minorities and women
10	contributions or funds provided to technology incubators which are approved by the Central Government
11	rural development projects
12	disaster management, including relief, rehabilitation and reconstruction activities
13	slum area development where ‘slum area’ shall mean any area declared as such by the Central Government or any State Government or any other competent authority under any law for the time being in force

AI Summary

Corporate social responsibility applicability: trainee stipend payments qualify only if they align with Schedule VII activities and company CSR policy. Applicability of corporate social responsibility contributions turns on whether the expenditure falls within Schedule VII activities and is adopted in the company's CSR policy by the Board. Payments to trainees not on payroll may qualify as CSR only if they implement or support permitted activities such as vocational skill development, improvement in education, or rural development, and must be specifically included in the CSR policy and governed according to CSR implementation and reporting procedures.