The Hindu Business Line, August 08, 2026
A Parliamentary panel has recommended to the government to examine the feasibility of permitting CSR contributions in kind through an appropriate statutory or regulatory framework. It has supported increasing the threshold of profit to ₹10 crore for CSR, which would benefit Micro, Small and Medium Enterprises (MSME)
At present, the Companies Act says a company having net worth of ₹500 crore or more or turnover of ₹1,000 crore or more or a net profit of ₹5 crore or more in the immediately preceding financial years need to spend 2 per cent of its profit on Corporate Social Responsibility (CSR).
The Corporate Laws (Amendment) Bill proposed raising the threshold for applicability of CSR to ₹10 crore. Also, it proposed additional time for transfer of unspent CSR amounts to the designated account, enhancing the threshold for constitution of the CSR Committee, and enabling exemption of such class or classes of companies as may be prescribed.
In its report, the Joint Committee, while favouring the higher threshold, was of the considered view that recognising in-kind contributions, where appropriately regulated, has the potential to enhance the effectiveness, flexibility and impact of CSR initiatives by enabling companies to leverage their core competencies and resources for public benefit. At the same time, the committee recognises that such a framework must adequately address concerns relating to objective valuation, transparency, auditability and accountability.
It also noted that the proposal of the National Disaster Management Authority (NDMA) to treat the free-of-cost supply of products for disaster relief as eligible CSR expenditure is presently under consideration and that valuation principles under the GST framework have been suggested for determining the value of such contributions.
The Committee, therefore, “recommend that the Government examine the feasibility of permitting CSR contributions in kind through an appropriate statutory or regulatory framework, incorporating robust safeguards, including objective valuation norms, independent verification, appropriate disclosure and reporting requirements, and effective monitoring mechanisms, so as to prevent misuse or overvaluation while ensuring that the objectives and integrity of the CSR framework are fully preserved.”
unutilised funds
It agreed that CSR funds should not be utilised through any implementing agency, including organisations, trusts, societies, non-governmental organisations and Section 8 companies. It was of the view that any CSR contribution made to an entity included in a duly notified negative list should not qualify as CSR expenditure for the purposes of compliance.
Further it recommended that the criteria for inclusion of any entity in such a negative list should be objective, transparent and based solely on statutory provisions or orders passed by a competent authority, to ensure certainty, fairness and uniform application. It also recommended that the restriction should operate only for the period and subject to the conditions specified in the relevant notification, and that an appropriate statutory mechanism be provided for removal of an entity from the negative list upon the cessation of the grounds that led to its inclusion. Accordingly, it suggested change in the bill prescribing a negative list of entities ineligible to receive CSR contributions.
The Standing Committee on Finance will hold its next sitting on Thursday 2 to study the regulatory roadmap for Virtual Digital Assets (VDAs), according to a notice issued by the Lok Sabha Secretariat on 25 June 2026.
The meeting will be held in the Parliament House Annexe, New Delhi. The sitting is dedicated entirely to the subject ‘A Study on Virtual Digital Assets (VDAs) and Way Forward’ and has been split into three sessions.
From 1100 hrs to 1230 hrs, the Committee will record oral evidence of the representatives of the Reserve Bank of India (RBI). RBI officials are expected to present the central bank’s assessment of VDAs, covering financial stability risks, impact on monetary policy, concerns around money laundering, investor protection, and the need for a regulatory framework. The RBI has previously cautioned against private cryptocurrencies while supporting a central bank digital currency.
The second session, from 1230 hrs to 1330 hrs, will involve a discussion with representatives of the Institute of Chartered Accountants of India (ICAI). The ICAI is likely to share inputs on taxation of VDAs, accounting standards for crypto holdings, audit challenges, and disclosure norms for companies and individuals dealing in digital assets. The Institute has been working on guidance notes for VDA transactions since the introduction of the 30% tax and 1% TDS in 2022.
After lunch, the Committee will reconvene at 1400 hrs onwards for internal deliberations. During this closed-door session, Members will discuss the depositions made by RBI and ICAI and examine possible recommendations on the way forward for India’s VDA ecosystem.
The notice, issued by Bharti Sanjeev Tuteja, Director, states that agenda papers will be circulated to Members through the Member’s Portal and e-mail later. Members have been requested to make it convenient to attend the sitting.
The Standing Committee on Finance examines legislation and policies related to the Ministry of Finance, RBI, SEBI, banks, insurance, and taxation. Unlike the Public Accounts Committee which audits past expenditure, this Committee looks at current policy issues and future frameworks.
India currently taxes VDAs at 30% on gains with 1% TDS on transfers, but lacks a comprehensive law governing trading, exchanges, or investor safeguards. The July 2 sitting signals Parliament’s intent to take expert inputs before shaping a potential regulatory or legislative response on crypto assets.
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