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SC Tells MP Mahua Moitra To Take Up Issue Of Exclusion Of CM Relief Fund From CSR In Parliament

Sanya Talwar
5 May 2020 7:40 AM GMT
SC Tells MP Mahua Moitra To Take Up  Issue Of Exclusion Of CM Relief Fund From CSR In Parliament
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While holding that there was no respresentation by an aggrieved party before the Supreme Court, the Top Court refused to entertain MP Mahua Moitra's plea challenging the circular issued by Ministry of Corporate Affairs (MCA) in so far as it excludes Chief Minister's Relief Funds from the ambit of Corporate Social Responsibility (CSR).A bench of Justices Ashok Bhushan, Sanjay Kishan Kaul, and...

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While holding that there was no respresentation by an aggrieved party before the Supreme Court, the Top Court refused to entertain MP Mahua Moitra's plea challenging the circular issued by Ministry of Corporate Affairs (MCA) in so far as it excludes Chief Minister's Relief Funds from the ambit of Corporate Social Responsibility (CSR).

A bench of Justices Ashok Bhushan, Sanjay Kishan Kaul, and BR Gavai observed that the said issue be raised before appropriate forum, i.e. the Parliament.

"There is no corporate entity before us, these issues can be raised before the Parliament" - Supreme Court

Senior Advocate CA Sundaram appearing for Moitra submitted,

"The contribution to PM relief fund or any other fund set up for socio economic  comes under CSR. It cannot come under schedule 8 at all. Can fall under schedule 12 because it doesn't cover the subjects enlisted under schedule 8. This fund is not meant for socio economic development"

"Whether state should get benefit out of it or not the petitioner can debate it in the parliament. We agree the fund may not be for socio economic but it can come under PM relief fund" - Bench

In light of this, Senior Advocate CA Sundaram withdrew the petition.

Moitra in her plea had highlighted that to exlcude the fund(s) from purview of CSR was in direct violation of Constitutaional tenets of federalism and Article 14 as well as being directly ultra vires of the Companies Act.

Further, the MP had contended that law was perverse to the said notification made distinctions on the basis of contributions made to PMCARES fund and CM relief funds, in so far as only the former shall attract CSR.

"... the unfair treatment of identical contributions to the State Relief Funds is against public interest and public policy, in so far as it disincentivizes corporate contributions which the State Governments would have otherwise received, under a hitherto permissible head of payment under the same statute." - Moitra had stated in her petition.

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