Can a Newly Incorporated Trust Apply for CSR Funds?

Many newly formed charitable trusts are keen to approach companies for Corporate Social Responsibility (CSR) funding. A common question that arises is whether a newly incorporated trust is eligible to receive CSR funds.

The answer lies in the Companies (Corporate Social Responsibility Policy) Rules, 2014, particularly Rule 4 relating to CSR implementation.

Under the CSR Rules, companies may undertake CSR activities either directly or through certain eligible entities such as Section 8 companies, registered public trusts, or registered societies. However, when CSR activities are implemented through an independent trust or NGO, the rules require that such entity should have an established track record of at least three years in undertaking similar activities.

In practical terms, this means that a newly incorporated trust generally cannot receive CSR funds immediately. Companies are expected to work with organisations that have demonstrated experience in carrying out social projects for a minimum period of three years.

Apart from the track record requirement, any entity intending to undertake CSR activities must also register with the Central Government by filing Form CSR-1 on the MCA portal. Once the form is approved, a CSR Registration Number is generated, which must be quoted by companies while routing CSR funds.

Therefore, a newly formed trust should focus on building its activities, documenting its social work, and establishing a track record before approaching companies for CSR partnerships.

For guidance on CSR eligibility, CSR-1 registration, and trust compliance matters, you can reach out to:

Phone: +91 9845721255