Corporate social responsibility requirement argued to be carried by government through a dedicated cess and tax-law changes.
Section 135 of the Companies Act, 2013 imposes a statutory CSR duty on qualifying companies to create a CSR committee, adopt a CSR policy, supervise specified Schedule VII activities and allocate board approved resources calculated from recent profits; Explanation 2 to Section 37(1) of the Income tax Act disallows deduction for expenditure recorded as CSR, though other deduction heads may be available. Enforcement has been weakened by decriminalisation, and the authors propose a dedicated government-funded CSR cess, repeal of Section 135 and removal of Explanation 2 to transfer CSR responsibility to the state. (AI Summary)