CSR Registration by NGOs

The Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 (“New CSR Rules”) has introduced substantial changes in the specifications and procedure to be followed by the NGOs while discharging their CSR obligations
One of the major changes introduced via New CSR Rules for the NGOs is making registration compulsory for undertaking CSR activities on behalf of companies.
Such registration is required to be taken in e-form CSR-1. The purpose of mandatory registration is for monitoring the activities of the NGOs and other agencies.

Eligibility Criteria for NGO

The conditions for an NGO to receive CSR funds from a company only if are as follows:

• A section 8 company Registered under section 12A and 80G of the Income Tax and have at least 3 years of undertaking charitable activities.
• A registered public trust Registered under section 12A and 80G of the Income Tax and have at least 3 years of undertaking charitable activities.
• A registered society Registered under section 12A and 80G of the Income Tax and have at least 3 years of undertaking charitable activities.

Registration of an NGO with MCA portal for accessing CSR funds

Rule 4(2) of the New Companies CSR Amendment Rules, 2021 specifies the following procedure for the registration of an NGO with an MCA portal for accessing corporate CSR funds:

• Every NGO that intends to undertake the CSR activity need to register itself with the Central Government by filing the form CSR-1 electronically with the Registrar
• Form CSR-1 will be verified digitally by a Chartered Accountant in practice or a Company Secretary in practice or a Cost Accountant in practice
• On the submission of the Form CSR-1 on the portal, a unique CSR Registration Number will be generated by the system automatically.

Benefits of CSR-1

The benefit of CSR-1 is as follows:

• It improves the public image of NGOs.
• CSR activities become hassle-free.
• It enhances the goodwill of NGOs.
• Secure funding from Corporate with fewer legal hurdles.