Under the companies law, certain classes of companies have to shell out at least two per cent of the average net profits, made during the three immediately preceding financial years, towards Corporate Social Responsibility (CSR) activities.
Generally, compoundable offences are those which can be settled by paying certain amount of money.
Minister of State for Corporate Affairs Anurag Singh Thakur also told the Lok Sabha that the entire CSR architecture is disclosure-based and companies concerned are required to file details of CSR expenditure annually through MCA21 portal.
"Whenever any violation of CSR provisions is reported, action against such non-compliant companies is initiated as per provisions of the Companies Act, 2013 after due examination of records and following due process of law. So far, sanction for prosecution has been accorded in 366 cases.
"All CSR related offences are compoundable. So far 121 applications for compounding have been made and 37 cases have been compounded," the minister said in a written reply.
Under Section 135 of the Companies Act, 2013, every company having net worth of at least Rs 500 crore, turnover of Rs 1,000 crore or more, or a minimum net profit of Rs 5 crore during the immediately preceding financial year has to make CSR expenditure. RAM ANU