{"id":92125,"date":"2025-06-01T11:15:22","date_gmt":"2025-06-01T11:15:22","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=92125"},"modified":"2025-06-01T11:15:22","modified_gmt":"2025-06-01T11:15:22","slug":"with-reference-to-corporate-social-responsibility-csr-rules-in-india","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/","title":{"rendered":"With reference to Corporate Social Responsibility (CSR) rules in India"},"content":{"rendered":"<p>With reference to Corporate Social Responsibility (CSR) rules in India, consider the following statements :<\/p>\n<ul>\n<li>CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities.<\/li>\n<li>CSR rules do not specify minimum spending on CSR activities.<\/li>\n<\/ul>\n<p>Which of the statements given above is\/are correct ?<\/p>\n<p>[amp_mcq option1=&#8221;1 only&#8221; option2=&#8221;2 only&#8221; option3=&#8221;Both 1 and 2&#8243; option4=&#8221;Neither 1 nor 2&#8243; correct=&#8221;option1&#8243;]<\/p>\n<div class=\"psc-box-pyq-exam-year-detail\">\n<div class=\"pyq-exam\">\n<div class=\"psc-heading\">This question was previously asked in<\/div>\n<div class=\"psc-title line-ellipsis\">UPSC IAS &#8211; 2024<\/div>\n<\/div>\n<div class=\"pyq-exam-psc-buttons\"><a href=\"\/pyq\/pyq-upsc-ias-2024.pdf\" target=\"_blank\" class=\"psc-pdf-button\" rel=\"noopener\">Download PDF<\/a><a href=\"\/pyq-upsc-ias-2024\" target=\"_blank\" class=\"psc-attempt-button\" rel=\"noopener\">Attempt Online<\/a><\/div>\n<\/div>\n<section id=\"pyq-correct-answer\">The question is about Corporate Social Responsibility (CSR) rules in India under the Companies Act, 2013. Let&#8217;s examine the statements:<br \/>\nStatement 1: &#8220;CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities.&#8221; This statement is correct. The CSR rules (specifically Schedule VII of the Companies Act, 2013 and associated rules\/clarifications) explicitly exclude activities undertaken in the normal course of business, activities that benefit only employees of the company, or activities conducted solely for the benefit of the company itself from being considered as CSR expenditure.<br \/>\nStatement 2: &#8220;CSR rules do not specify minimum spending on CSR activities.&#8221; This statement is incorrect. Section 135 of the Companies Act, 2013 mandates that companies meeting certain turnover, net worth, or net profit criteria in any financial year must constitute a CSR Committee and &#8220;shall ensure that the company spends, in every financial year, at least two per cent. of the average net profit of the company made during the three immediately preceding financial years&#8221;. This clearly specifies a minimum spending requirement for eligible companies.<br \/>\nTherefore, only statement 1 is correct.<br \/>\n<\/section>\n<section id=\"pyq-key-points\">The Companies Act, 2013 made India the first country to legally mandate CSR spending for eligible companies. The objective is to encourage businesses to contribute to societal goals through corporate resources. The law specifies eligible activities and mandates a minimum expenditure based on profitability.<br \/>\n<\/section>\n<section id=\"pyq-additional-information\">Eligible CSR activities are listed in Schedule VII of the Act and include areas like eradicating hunger and poverty, promoting education, healthcare, environmental sustainability, protection of national heritage, etc. If a company fails to spend the mandated amount, it is required to explain the reasons in its annual report or transfer the unspent amount to a designated fund within a specified timeframe, depending on whether the project is ongoing or not.<br \/>\n<\/section>\n","protected":false},"excerpt":{"rendered":"<p>With reference to Corporate Social Responsibility (CSR) rules in India, consider the following statements : CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities. CSR rules do not specify minimum spending on CSR activities. Which of the statements given above is\/are correct ? [amp_mcq &#8230; <\/p>\n<p class=\"read-more-container\"><a title=\"With reference to Corporate Social Responsibility (CSR) rules in India\" class=\"read-more button\" href=\"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/#more-92125\">Detailed Solution<span class=\"screen-reader-text\">With reference to Corporate Social Responsibility (CSR) rules in India<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1092],"tags":[1103,1112],"class_list":["post-92125","post","type-post","status-publish","format-standard","hentry","category-upsc-ias","tag-1103","tag-economic-and-social-development","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>With reference to Corporate Social Responsibility (CSR) rules in India<\/title>\n<meta name=\"description\" content=\"The question is about Corporate Social Responsibility (CSR) rules in India under the Companies Act, 2013. Let&#039;s examine the statements: Statement 1: &quot;CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities.&quot; This statement is correct. The CSR rules (specifically Schedule VII of the Companies Act, 2013 and associated rules\/clarifications) explicitly exclude activities undertaken in the normal course of business, activities that benefit only employees of the company, or activities conducted solely for the benefit of the company itself from being considered as CSR expenditure. Statement 2: &quot;CSR rules do not specify minimum spending on CSR activities.&quot; This statement is incorrect. Section 135 of the Companies Act, 2013 mandates that companies meeting certain turnover, net worth, or net profit criteria in any financial year must constitute a CSR Committee and &quot;shall ensure that the company spends, in every financial year, at least two per cent. of the average net profit of the company made during the three immediately preceding financial years&quot;. This clearly specifies a minimum spending requirement for eligible companies. Therefore, only statement 1 is correct. The Companies Act, 2013 made India the first country to legally mandate CSR spending for eligible companies. The objective is to encourage businesses to contribute to societal goals through corporate resources. The law specifies eligible activities and mandates a minimum expenditure based on profitability.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"With reference to Corporate Social Responsibility (CSR) rules in India\" \/>\n<meta property=\"og:description\" content=\"The question is about Corporate Social Responsibility (CSR) rules in India under the Companies Act, 2013. Let&#039;s examine the statements: Statement 1: &quot;CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities.&quot; This statement is correct. The CSR rules (specifically Schedule VII of the Companies Act, 2013 and associated rules\/clarifications) explicitly exclude activities undertaken in the normal course of business, activities that benefit only employees of the company, or activities conducted solely for the benefit of the company itself from being considered as CSR expenditure. Statement 2: &quot;CSR rules do not specify minimum spending on CSR activities.&quot; This statement is incorrect. Section 135 of the Companies Act, 2013 mandates that companies meeting certain turnover, net worth, or net profit criteria in any financial year must constitute a CSR Committee and &quot;shall ensure that the company spends, in every financial year, at least two per cent. of the average net profit of the company made during the three immediately preceding financial years&quot;. This clearly specifies a minimum spending requirement for eligible companies. Therefore, only statement 1 is correct. The Companies Act, 2013 made India the first country to legally mandate CSR spending for eligible companies. The objective is to encourage businesses to contribute to societal goals through corporate resources. The law specifies eligible activities and mandates a minimum expenditure based on profitability.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/\" \/>\n<meta property=\"og:site_name\" content=\"MCQ and Quiz for Exams\" \/>\n<meta property=\"article:published_time\" content=\"2025-06-01T11:15:22+00:00\" \/>\n<meta name=\"author\" content=\"rawan239\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rawan239\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"With reference to Corporate Social Responsibility (CSR) rules in India","description":"The question is about Corporate Social Responsibility (CSR) rules in India under the Companies Act, 2013. Let's examine the statements: Statement 1: \"CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities.\" This statement is correct. The CSR rules (specifically Schedule VII of the Companies Act, 2013 and associated rules\/clarifications) explicitly exclude activities undertaken in the normal course of business, activities that benefit only employees of the company, or activities conducted solely for the benefit of the company itself from being considered as CSR expenditure. Statement 2: \"CSR rules do not specify minimum spending on CSR activities.\" This statement is incorrect. Section 135 of the Companies Act, 2013 mandates that companies meeting certain turnover, net worth, or net profit criteria in any financial year must constitute a CSR Committee and \"shall ensure that the company spends, in every financial year, at least two per cent. of the average net profit of the company made during the three immediately preceding financial years\". This clearly specifies a minimum spending requirement for eligible companies. Therefore, only statement 1 is correct. The Companies Act, 2013 made India the first country to legally mandate CSR spending for eligible companies. The objective is to encourage businesses to contribute to societal goals through corporate resources. The law specifies eligible activities and mandates a minimum expenditure based on profitability.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/","og_locale":"en_US","og_type":"article","og_title":"With reference to Corporate Social Responsibility (CSR) rules in India","og_description":"The question is about Corporate Social Responsibility (CSR) rules in India under the Companies Act, 2013. Let's examine the statements: Statement 1: \"CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities.\" This statement is correct. The CSR rules (specifically Schedule VII of the Companies Act, 2013 and associated rules\/clarifications) explicitly exclude activities undertaken in the normal course of business, activities that benefit only employees of the company, or activities conducted solely for the benefit of the company itself from being considered as CSR expenditure. Statement 2: \"CSR rules do not specify minimum spending on CSR activities.\" This statement is incorrect. Section 135 of the Companies Act, 2013 mandates that companies meeting certain turnover, net worth, or net profit criteria in any financial year must constitute a CSR Committee and \"shall ensure that the company spends, in every financial year, at least two per cent. of the average net profit of the company made during the three immediately preceding financial years\". This clearly specifies a minimum spending requirement for eligible companies. Therefore, only statement 1 is correct. The Companies Act, 2013 made India the first country to legally mandate CSR spending for eligible companies. The objective is to encourage businesses to contribute to societal goals through corporate resources. The law specifies eligible activities and mandates a minimum expenditure based on profitability.","og_url":"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2025-06-01T11:15:22+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/","url":"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/","name":"With reference to Corporate Social Responsibility (CSR) rules in India","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2025-06-01T11:15:22+00:00","dateModified":"2025-06-01T11:15:22+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"description":"The question is about Corporate Social Responsibility (CSR) rules in India under the Companies Act, 2013. Let's examine the statements: Statement 1: \"CSR rules specify that expenditures that benefit the company directly or its employees will not be considered as CSR activities.\" This statement is correct. The CSR rules (specifically Schedule VII of the Companies Act, 2013 and associated rules\/clarifications) explicitly exclude activities undertaken in the normal course of business, activities that benefit only employees of the company, or activities conducted solely for the benefit of the company itself from being considered as CSR expenditure. Statement 2: \"CSR rules do not specify minimum spending on CSR activities.\" This statement is incorrect. Section 135 of the Companies Act, 2013 mandates that companies meeting certain turnover, net worth, or net profit criteria in any financial year must constitute a CSR Committee and \"shall ensure that the company spends, in every financial year, at least two per cent. of the average net profit of the company made during the three immediately preceding financial years\". This clearly specifies a minimum spending requirement for eligible companies. Therefore, only statement 1 is correct. The Companies Act, 2013 made India the first country to legally mandate CSR spending for eligible companies. The objective is to encourage businesses to contribute to societal goals through corporate resources. The law specifies eligible activities and mandates a minimum expenditure based on profitability.","breadcrumb":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/exam.pscnotes.com\/mcq\/with-reference-to-corporate-social-responsibility-csr-rules-in-india\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/exam.pscnotes.com\/mcq\/"},{"@type":"ListItem","position":2,"name":"UPSC IAS","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/upsc-ias\/"},{"@type":"ListItem","position":3,"name":"With reference to Corporate Social Responsibility (CSR) rules in India"}]},{"@type":"WebSite","@id":"https:\/\/exam.pscnotes.com\/mcq\/#website","url":"https:\/\/exam.pscnotes.com\/mcq\/","name":"MCQ and Quiz for Exams","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/exam.pscnotes.com\/mcq\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209","name":"rawan239","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","caption":"rawan239"},"sameAs":["https:\/\/exam.pscnotes.com"],"url":"https:\/\/exam.pscnotes.com\/mcq\/author\/rawan239\/"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/92125","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/comments?post=92125"}],"version-history":[{"count":0,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/92125\/revisions"}],"wp:attachment":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/media?parent=92125"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/categories?post=92125"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/tags?post=92125"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}