New Delhi – The window for transferring unspent corporate social responsibility money has been widened from 30 days to 90, a change that sounds administrative and materially alters year-end treasury planning.
The underlying obligation sits in Section 135 of the Companies Act, 2013. Where a company has an ongoing project, unspent CSR money moves to a separate Unspent CSR Account and must be deployed within the following three financial years. Where the activity is not an ongoing project, unspent money goes to a Schedule VII fund such as the PM Relief Fund or Swachh Bharat Kosh.
The ongoing project label carries the weight
Everything turns on whether a project is classified as ongoing. That label buys three years to spend. The alternative is surrendering the money to a government fund within months, with no further say over its use.
The incentive to classify generously is obvious, and it is where auditors and the Ministry of Corporate Affairs will concentrate. A project designated ongoing should have a defined timeline and deliverables set before year end, not assembled afterwards to justify a retention.
What non-compliance costs
A company failing to transfer faces a penalty of twice the amount that should have been moved, or one crore rupees, whichever is lower. Every officer in default faces a personal penalty of up to two lakh rupees.
The personal exposure is the operative deterrent. A company-level fine is absorbed. A named officer penalty is not.
Decriminalisation on the table
The Corporate Laws Amendment Bill 2026 proposes moving certain CSR reporting defaults out of criminal proceedings and into civil penalties, alongside changes to the CSR threshold and committee requirements.
That would be a sensible correction. Criminal liability for a reporting lapse on a spending obligation was always disproportionate, and it pushed companies toward defensive compliance rather than better programmes.
CSR is not ESG, and the distinction is widening
CSR is a statutory spending obligation measured in rupees deployed. BRSR Core measures how a company operates, in emissions, water, safety and wage fairness. A company can discharge its CSR duty in full while performing poorly on every assured attribute.
Source: Section 135 of the Companies Act, 2013, CSR Rules as amended in 2026, and the Corporate Laws Amendment Bill 2026.
