SC Dismisses Mahua Moitra's Plea Challenging Exclusion of Donations to CM's Relief Fund from CSR.
Updated: Aug 12, 2020
News Article covered by Niloy Subir Ghosh
The Supreme Court on Monday; 10th August 2020 dismissed a petition filed by TMC MP Mahua Moitra challenging a circular issued by the Central government excluding Chief Minister's Relief Fund from the purview of Corporate Social Responsibility (CSR) activities under Section 135 of the Companies Act. CSR is defined as a corporation's sense of responsibility towards the community and environment by which a company entities visibly contribute to the social good. The plea was filed by Advocate-on-Record Rohit Anil Rathi, appearing on behalf of the MP from Krishnanagar (West Bengal) and the matter was heard by a Bench comprising of Justices Ashok Bhushan, R. Subhash Reddy ad BR Gavai.
The bench heard the plea and noted that Moitra had filed a similar plea which had been dismissed on 5th May 2020. The AOR submitted that the previous petition had been withdrawn on 5th May and further submitted that the notification which was challenged came into effect subsequently on May 27; Thus considering this subsequent development; The advocated prayed for the matter to be heard.
However, the Bench was not inclined to entertain the matter and noted,
"How can the same petitioner filed another petition on the same issue? This won't set the right precedent. You shouldn't have filed it again after you withdrew a similar petition in May."
Accordingly, the bench observed that as the Petitioner had filed a plea for similar relief, which had been dismissed as withdrawn on 5th May 2020, the court was not inclined to hear this instant petition and dismissed the plea.
The plea with the same subject matter was filed by the MP and the said was dismissed by the court on May 5th 2020. The plea challenged the circular by the MCA [Ministry Of Corporate Affairs] stating that only donations made towards the PM CARES fund will attract CSR, and donations to state relief funds will not be eligible to fall under the purview of the CSR. The petitioner submitted that this circular would act as a disincentive to corporate contributions which the State Governments would have otherwise received. The petitioner in her petition had contended that the MCA circular was not only violative of Article 14 of the Constitution of India but was also ultra vires the provisions of the Companies Act of 2013; which includes CM Relief Funds as eligible recipients for realizing the corporate social responsibility.
The Bench had observed that there was no merit in the plea and thus there was no aggrieved
party before the court, and Moitra being a Member of Parliament, could raise the issue before
the Parliament. The petitioner then withdrew the petition.