Companies' contribution for the benefit of Central Armed Police Forces (CAPF), Central Para Military Forces (CPMF) veterans as well as their dependents will now be considered as CSR spending under the companies law, with the government making relevant amendments.
The corporate affairs ministry has amended Schedule VII of the Companies Act, 2013. This schedule pertains to board activities that can be taken up as Corporate Social Responsibility (CSR) activities.
Under the Act, certain class of profitable companies are required to shell out at least two per cent of their three-year annual average net profit towards CSR works in a particular financial year.
In Schedule VII, the words "Central Armed Police Forces (CAPF) and Central Para Military Forces (CPMF) veterans, and their dependents including widows" shall be inserted, the ministry said in a notification dated June 23.
A company having a net worth of Rs 500 crore, turnover of Rs 1,000 crore or net profit of Rs 5 crore or more is required to spend money towards CSR activities.
Corporate Professionals Group Founder Pavan Kumar Vijay said that spending on measures for the benefit of armed forces veterans, war widows and their dependents are considered as CSR.
"Through the amendment in the Schedule, the scope of the clause has been expanded to include spends towards benefit of Central Armed Police Forces (CAPF) and Central Para Military Forces (CPMF) veterans, and their dependents including widows. This is a laudable step and a recognition of the sacrifices made by our para military forces," he said.
Families of CAPF personnel get Rs 15 lakh from the 'Bharat Ke Veer' fund, when a personnel is killed in the line of duty. The fund was launched by the Union Home ministry in 2017.
It was created with an aim that common people who wish to pay tributes and make monetary contributions for CAPF men and women can do so in a streamlined manner. All contributions to this fund are exempt from income tax as per government rules.
The personnel who are killed in action are also eligible for ex-gratia payment under service rules.