Tuesday, Sep 29, 2020 | Last Update : 11:48 PM IST

189th Day Of Lockdown

Maharashtra1351153104994735751 Andhra Pradesh6811616123005745 Tamil Nadu5863975307089383 Karnataka5824584697508641 Uttar Pradesh3908753312705652 Delhi2730982407035272 West Bengal2505802198444837 Odisha212609177585866 Telangana1872111564311107 Kerala179923121264698 Bihar178882164537888 Assam169985139977655 Gujarat1332191132403417 Rajasthan1288591077181441 Haryana1237821059901307 Madhya Pradesh117588932382207 Punjab107096840253134 Chhatisgarh9856566860777 Jharkhand7770964515661 Jammu and Kashmir69832495571105 Uttarakhand4533233642555 Goa3107125071386 Puducherry2548919781494 Tripura2412717464262 Himachal Pradesh136799526152 Chandigarh112128677145 Manipur9791760263 Arunachal Pradesh8649623014 Nagaland5768469311 Meghalaya5158334343 Sikkim2707199431 Mizoram178612880
  Business   Companies  29 Apr 2017  Bajaj wants clarity on tax exemption on CSR spending

Bajaj wants clarity on tax exemption on CSR spending

Published : Apr 29, 2017, 6:21 pm IST
Updated : Apr 29, 2017, 6:21 pm IST

Companies spend 2 per cent of their average net profit of past three years mandated by Companies Act.

Bajaj Group patriarch Rahul Bajaj.
 Bajaj Group patriarch Rahul Bajaj.

New Delhi: Bajaj Group patriarch Rahul Bajaj has asked the government to clarify whether the Indian firms spending two per cent of their profits on corporate social responsibility, as mandated by the new company law, should get tax exemption on it.

Citing the conflicts in the tax laws, the veteran industry leader today said that when the companies spend money on charitable trust or donate to institutions as the Prime Minister Relief Fund, then they get exemptions but CSR spending is taxed.


"Today you spend money on R&D and you get 130 to 150 per cent write off. You give money into the PM Relief Fund, you will get 100 per cent write off. On various thing, you donate you get write off. Will you give it to the same organisation for CSR. You said that you would not get. There is contradiction in terms. It's not clear at all," Bajaj said.

However, he also said: "We do not want any exemption and incentive but there is a clearcut anomaly there." According to Bajaj, who is now involved with few NGOs and charitable organisations as member of the board of trustees and chairman, CSR is also like a philanthropy and "anomaly has to be clarified by the Ministry of Corporate Affairs and the Ministry of Finance".


The Companies Act of 2013 has made it mandatory on the corporates to spend 2 per cent of their average net profit of the past three years on corporate social responsibility-driven activities.

"It is for CII to consider whether they deem fit it to refer the concerned relevant committee to make it to the government and the Ministry of Corporate Affairs and Finance Ministry also," Bajaj said while addressing the annual session of industry body CII here.

According to him, if a company spends on charitable work through CSR, then the end recipient get the amount after tax is paid. "I know people who are associated with outstanding organisation including Nobel Peace Prize winner Kailash Satyarthi, I know how difficult for him to get money," he said.


Thermax Chairperson Meher Pudumjee said that there was a need to think  beyond CSR activities involving public private participation. Godrej & Boyce Manufacturing Co CMD Jamshyd N Godrej said that there is no short of cause for spending on social works.

According to Godrej, there is need to think beyond the traditional philanthropy leveraging intellectual, financial and human capital. Infosys co-founder S Gopalakrishnan said more funds (as part of CSR and philanthropy) needs to be channelled into research in various areas.

Kris, as Gopalakrishnan is popularly called, has donated USD 1.8 million to Carnegie Mellon University (CMU) for brain research. He has also committed funding in a brain research centre at the Indian Institute of Science and set up three chairs at the Centre for Computational Brain Research, IIT Madras.


Tags: bajaj group, rahul bajaj, csr, corporate social responsibility
Location: India, Delhi, New Delhi