Insights

Clarification on spending of CSR funds for ‘creating health infrastructure for COVID care’ and Government has made Aadhaar mandatory as identity proof for all employees and workers

May 14, 2021

Another update concerning Corporate Social Responsibility (CSR) from the desk of Ministry of Corporate Affairs (MCA) 

Ministry of Corporate Affairs (MCA) has issued a General Circular No. 09/2021 on 5th day of May, 2021 with regard to a clarification on spending of CSR funds.

The Circular clarifies that spending of CSR funds for ‘creating health infrastructure for COVID care’, ‘establishment of medical oxygen generation and storage plants’, ‘manufacturing and supply of Oxygen concentrators, ventilators, cylinders and other medical equipment for countering COVID-19’ or similar such activities are eligible CSR activity under item nos. (i) and (xii) of Schedule VII of the Companies Act, 2013 relating to promotion of health care, including preventive health care and disaster management respectively.

Reference is also drawn to item no. (ix) of Schedule VII of the Companies Act, 2013 which permits contribution to specified research and development projects as well as contribution to public funded universities and certain Organizations engaged in conducting research in science, technology, engineering, and medicine as eligible CSR activities.

The companies including Government companies may undertake the activities or projects or programmes using CSR funds, directly by themselves or in collaboration as shared responsibility with other companies, subject to fulfillment of Companies (CSR Policy) Rules, 2014 and the guidelines issued by this Ministry from time to time.

The said Circular has been issued in continuation to the MCA’s General Circular No. 10/2020 dated 23rd day of March, 2020 wherein it was clarified that spending of CSR funds for Covid-19 is an eligible CSR activity.

The complete text of the Circular may be viewed at below link:

http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo9_05052021.pdf

 

News from the desk of Ministry of Labour and Employment

Government of India vide Gazette notification no.1603 has appointed the 3rd day of May 2021 as the date on which the provisions of section 142 of the Code on Social Security, 2020 shall come into force. As per the notification, the Government has made Aadhaar mandatory as identity proof for all employees and workers, including organized and unorganized workers, to avail social security benefits with effect from May 3rd in order to prevent the misuse of the benefit being given to workers or employees with a fake identity. Section 142 of the Code on Social Security, 2020 provides that the employees or unorganized workers shall, to register as beneficiaries for social security benefits or avail other social security services, establish their identity or, as the case may be, the identity of their family members or dependents through Aadhaar number. The Aadhaar registration is mandatory for all workers and employees seeking social security benefits from the government in either kind or cash. These would also include medical and sickness benefits, pension, gratuity, maternity benefit, or any other benefit or withdrawal of fund. Further, Aadhaar registration will also be mandatory for availing services of the career centre or receiving any payment or medical attendance as the insured person himself or for their dependents.

The complete text of the Circular may be viewed at below link:https://lexcomply.com/rsjadmin/news/202105075740Notf.%20S.O.%201730(E)-Appoints%2003-05 2021%20on%20which%20prov%20of%20sec%2042%20of%20Code%20on%20Social%20Security%202020%20come%20into%20force.pdf 

Last updated: 14/05/2021

Article contributed by:

Luv Malhotra

Associate Director- Corporate Secretarial

MBG Corporate Services

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