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PSUs, private entities not spending 2% of profit in CSR activities in Assam: assembly panel

Representational Image. Photo: Special arrangement

Representational Image. Photo: Special arrangement

Big PSUs, including Oil India, Oil and Natural Gas Corporation (ONGC), Indian Oil Corporation (IOC) and Coal India, and private sector entities are not spending the mandatory 2% of their annual profits on corporate social responsibility (CSR) activities in Assam, despite having their production units in the State, an assembly committee has observed.

The assembly panel in its report for the Industries Department for 2021-22 suggested that PSUs and private firms with production units outside Assam should spend at least 5% of their total CSR funds in the State.

"The committee observes with serious note that the performance of CSR activities of the PSUs and the private sector industries in the State is very dismal,” the Departmentally Related Standing Committee on Development (A) Departments said in its report.

“... the private sector industries and the PSUs such as OIL, ONGC, IOC, NRL, IOCL(BGR), Coal India Ltd, with their production units in the State are not spending the mandatory two per cent of their annual profit(s) for gainful purpose,” it added.

“The CSR activities undertaken by the companies are mainly concentrated in the nearby areas of their units, while such works were not evenly distributed all over the State,” the panel said.

“The committee further observes that the PSUs and the private sector industries with their production units outside the State are hardly spending any amount of CSR fund(s) in Assam, although the State is lagging far behind in respect of the development indices and the SDG goals,” the report said.

"Accordingly, the panel directed PSUs and private sector industries with their production units in Assam to compulsorily spend 2% of their annual profits for CSR activities, and "evenly distribute their CSR funds all over the State instead of concentrating only on a few nearby districts”.

The panel suggested the formation of district-level committees, comprising Deputy Commissioners, MLAs and MPs, for selection and proper monitoring of the schemes under the CSR.

"The details of the schemes along with their location and amount spent for each scheme in the State during the last five financial years under CSR fund by both the PSUs and the private sector industries shall be placed before the committee(s) within a period of six months," it added.

According to the Companies Act, 2013, every entity having a net worth of ₹500 crore or more, or turnover of ₹1,000 crore or more, or a net profit of ₹5 crore or more must spend at least 2% of the average net profits made during the three immediately preceding financial years, giving preference to the local areas around it where it operates.


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Printable version | Oct 6, 2022 12:26:15 am | https://www.thehindu.com/news/national/other-states/psus-private-entities-not-spending-2-of-profit-in-csr-activities-in-assam-assembly-panel/article36044529.ece