Corporate Social Responsibility in the Companies Act: Understanding Section 135 of the Companies Act 2013


Corporate Social Responsibility (CSR) has become an important aspect of the business world today, driven by the need for companies to go beyond profits and contribute to people’s social well-being. In India, Section 135 of the Companies Act 2013 made corporate social responsibility mandatory for certain companies, making a significant impact helping to create corporate responsibility in the country. This article examines Section 135 of the Companies Act 2013 and its importance in promoting social responsibility.


What is Corporate Social Responsibility (CSR)?

The ethical and moral behavior of companies towards the public is called Corporate Social Responsibility (CSR).

According to Article 135 of the Companies Act 2013, all companies, whether public or private, must comply with social responsibility. In other words, CSR is mandatory for all companies registered under the 2013 Companies Act. Some examples of CSR initiatives are as follows:

• Reduce carbon emissions footprint and energy use

• Participate in wildlife protection programs

• Promote charity and volunteer work

• Help local communities

• Improve labor laws

• Increase diversity and equity 4 Non-corporations

What is Section 135 of the Companies Act 2013?

Section 135 of Companies Act, 2013 provides the legal framework for corporate social responsibility in India. This section applies to companies that meet the requirements in a financial year that includes: • Assets valued at INR 5 billion or more; OR

• Transactions of INR 10 billion or more; OR

• Revenue 5 crore INR

Or more Such companies must form a CSR group and allocate 2% or more of their average income for the last three years to CSR plans.


Important terms and conditions regarding the liability of the company.

Below are some important terms and conditions regarding the liability of the company:

1. Determination of corporate responsibility

Article 135 states that businesses should have social responsibility in areas such as safety and health. They have the flexibility to choose and implement CSR activities based on their specific business needs and potential impacts.

2. Corporate Social Responsibility Committee

Companies within the scope of article 135 must have a social responsibility committee consisting of at least three members, one of which is an independent member.

The role of the board of directors is to establish and approve the corporate responsibility policy, monitor its implementation and ensure the effectiveness of the use of corporate responsibility.

3. CSR Expenditures

Article 135 requires eligible companies to spend at least 2% of their average income on CSR activities over the last three years. This ensures that the company spends its money fairly on health and environmental benefits.

4. Corporate Social Responsibility Policy

Companies should have a social responsibility policy that outlines what activities should be done, how they will be done, and the reasons for choosing a project or initiative. The policy must be approved by the board of directors and posted on the company’s website.

5. Disclosure and Explanation

Companies must explain their corporate responsibilities, policies and expenditures in a transparent and accountable manner in their annual reports. Stakeholders should be given detailed information about the CSR activities undertaken, the amount spent and the impact achieved.


Types of CSR Activities Under the Companies Act, 2013

According to the Companies Act Calendar, 2013, India allows eligible companies to receive the following CSR incentives:

1. Eradication of Malnutrition, Poverty and Hunger

2. Promotion

3. Supportive education

4. CSR environmental initiatives

5. Preserving the nation’s art, culture and heritage

6. The Work can provide help and support to veterans, war widows and military families.

7. Contributions to the Prime Ministry National Aid Fund or other central government funds for the welfare, development and welfare of the people, tribes, other backward classes, women and minorities.

8. Financial support or grants recognized by the central government for the development of technology in universities.

9. Contribution to the construction of slum areas and rural development. Benefits and effects of section 135 of the Companies Act 2013 Section 135 of the Companies Act 2013 has produced many positive results, including:

1. Focus on community investment

This policy allows companies to share a certain percentage of profits and profits. It is related to. Environmental question.

This has led to a greater focus on community leadership, making it more responsive and more responsive to community needs.

2. Stakeholder Engagement

Companies are encouraged to work with stakeholders, including local communities, NGOs and government agencies, to identify and resolve social issues. Collaboration can foster better understanding, better performance of projects, and a shared sense of responsibility.

3. Strengthening accountability

Provisions introduced in Article 135 ensure that companies are responsible for their CSR activities. Stakeholders can measure the effectiveness, impact and efficiency of CSR initiatives with national development goals, thereby improving transparency and accountability

4. Social and Economic Development

Laws CSR spending has contributed to social and economic development in India. The company addresses important social issues by participating in initiatives such as skills development, education, health, sanitation and environmental protection.

It has played an important role in corporate social responsibility in India under Article 135 of the Companies Act No. Of 2013. The program promotes positive change, empowers communities and supports sustainable development by assuming human rights responsibility under law for eligible companies. While challenges remain, the incorporation of CSR into corporate law lays the foundation for responsible and ethical business practices, making India a leader and world leader in CSR. To learn more about CSR, you should speak to an attorney familiar with business or corporate law in the relevant field.


Best advocate in jaipur to contact

Advocate Kunal Sharma

+91 7737501808, +91 7790905299

Office Address
Plot No. 114, Ganesh Nagar,
Mansarover, Behind of Ganesh
Pairadise Jaipur- 302020 (Raj.)



























Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top