Under the Companies Act, 2013 and CSR Rules, the following activities shall NOT be considered as CSR activities (Mnemonic: FB-F-NSPEL-PESL):
Code
Activity Excluded from CSR
FB
Activities undertaken in normal course of business (OCOB)
F
Activities undertaken outside India
NSPEL
Activities for benefit of National Sports Persons — except training of Indian sportspersons representing the State / International level
P
Contribution to political parties
E
Activities benefitting employees of the company
S
Sponsorship for marketing its products
L
Activities done for fulfillment of statutory obligations under any other law
### Key Points to Remember
The activity must be beyond normal business operations to qualify as CSR.
Training of Indian sportspersons representing State/National/International level is a carve-out exception — this does qualify as CSR.
Mere fulfilment of another statutory duty (e.g., labour law obligations) cannot be claimed as CSR spending.
Worked example
### Example 1
Example 1: XYZ Ltd contributes ₹10 lakhs to a registered political party. Can this be counted as CSR? — No, contribution to political parties is expressly excluded.
### Example 2
Example 2: ABC Ltd, a pharma company, distributes free medicines outside India during a disaster. Counted as CSR? — No, activities undertaken outside India are excluded.
### Example 3
Example 3: PQR Ltd sponsors training of an Indian boxer representing India at the Olympics. Counted as CSR? — Yes, training of Indian sportspersons representing the country at international level is a permitted exception.
⚠️ Common exam mistakes
Treating sponsorship of marketing campaigns as CSR — sponsorship for product marketing is NOT CSR.
Counting employee welfare schemes (gym, canteen, employee insurance) as CSR — activities benefitting employees are excluded.
Assuming all sports-related contributions qualify — only training of Indian sportspersons representing State/National/International level qualifies; general sports contributions do not.
Treating compliance under other laws (e.g., labour welfare cess, pollution-control obligations) as CSR spend.
Bare-Act text Rule 2(1)(d) — Definition of CSR (Exclusions) · Companies (CSR Policy) Rules, 2014 · click to expand
Activities undertaken in pursuance of normal course of business, activities undertaken outside India (except training of Indian sportspersons representing any State or Union Territory at national level or India at international level), contribution to any political party under section 182, activities benefitting employees of the company, activities supported by companies on sponsorship basis for deriving marketing benefits for its products or services, and activities carried out for fulfilment of any other statutory obligations under any law in force in India shall not be considered as CSR activities.