Corporate Social Responsibility (Form CSR-2): Mandatory Reporting, Ongoing Project Rules & Unspent CSR Account

Published: February 10, 20256 min readEffective: Annual Filing Requirement

View Official Gazette / Govt Source Consult Senior Partner

Executive Regulatory Summary

Comprehensive advisory on statutory CSR mandates under Section 135 for companies meeting net worth (₹500 Cr), turnover (₹1000 Cr), or net profit (₹5 Cr) thresholds. Covers mandatory standalone filing of Form CSR-2, transfer of unspent funds to Schedule VII funds within 6 months, and establishing special Unspent CSR Accounts for ongoing projects.

Key Statutory Takeaways

Qualifying entities must spend at least 2% of average net profits of preceding 3 financial years on Schedule VII CSR activities.
Unspent amounts not relating to ongoing projects must be transferred to a Fund specified in Schedule VII (PM CARES / Clean Ganga) within 6 months.
Unspent amounts relating to ongoing projects must be moved to a special bank account titled 'Unspent CSR Account' within 30 days of FY closure.
Form CSR-2 must be filed separately on the MCA V3 portal as a web-based form.

Actionable Compliance Checklist for Businesses

Step-by-step advisory measures prescribed by ASGR and CO for immediate adherence:

1Calculate average net profits under Section 198 to determine the mandatory 2% statutory CSR obligation.

2Convene CSR Committee to review project implementation reports and milestone certifications.

3Open dedicated Unspent CSR Account with a scheduled bank if multi-year ongoing projects are underway.

4Complete and submit web-based Form CSR-2 on the MCA portal with registered DSC.

1. The Strict Penalty Regime for Non-Spent CSR

Non-compliance with CSR spending or failure to transfer unspent funds within statutory time limits attracts direct civil penal penalties under Section 135(7) of twice the unspent amount or one crore rupees, alongside personal fines on corporate officers.

Target Entities Governed by this Notification:

Corporate CSR Committees & DirectorsCompany Secretaries & Legal AdvisorsStatutory AuditorsImplementing Agencies & Foundations

Advisory Published By

CA Sanjay Agarwal

Senior Partner & Co-Founder • B. Com, FCA, CS Inter, FAFD (ICAI)

ASGR and CO, Chartered Accountants (Peer Review Certified: #018Xxx)

Statutory Disclaimer: This publication is compiled by ASGR and CO solely for general informational and educational purposes to assist corporate clients and peers in understanding statutory notifications. It does not constitute legal, tax, or formal secretarial advice. Before acting upon any provisions, specific professional counsel should be sought.

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