Section 8 Company for CSR Activities
A company can be referred as section 8 company which has get itself registered as charitable or not for profit organization and has obtained certificate of license from Central Government. Nonprofit organizations provide a platform where there can be direct links between the society and its well being for its development. Its main purpose is to promote non-profit objectives such as trade, commerce, art, charity, religion, environment protection, social welfare, education etc.
An Individual or an Association of individuals are eligible to be registered as section 8 company if it-
Has in its objects the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object;
Intends to apply its profits, if any, or other income in promoting its objects; and
Intends to prohibit the payment of any dividend to its members.
Role of Section 8 companies in CSR implementation-
Ministry of corporate affairs Companies Act, 2013 has introduced the concept and provision of mandatory Corporate Social Responsibility (CSR) for certain companies. CSR introduced as a tool to achieve sustainable development goals and give back to the society from company utilize various resources.
Section 135 of companies act contains provisions for CSR for prescribed companies.
The CSR spending can now be met by the company itself or through-
· Any non-profit entities either established by the corporate (singly or jointly with others) or independently established entities registered under section 12A and section 80G of the Income Tax Act.
· A section 8 company, registered trust or a registered society established by central government or state government.
· A Section 8 Company, a registered public trust or a registered society registered under Section 12A and 80G of the Income Tax Act, 1961 and that does not fall within the above categories, but such entity must have an established track record of at least three years in undertaking similar programs or projects.
Created & Posted By Aashima
Accounts Executive at TAXAJ
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