# CSR – Default in Spending & Excluded Activities
## 1. Default in CSR Spending
If a company fails to spend its CSR amount and does not transfer the unspent amount as required, a penalty is imposed:
| Defaulter | Penalty |
|---|---|
| Company | Twice the unspent amount OR ₹1 crore, whichever is lower |
| Officer in default | One-tenth (1/10) of the unspent amount OR ₹2 lakh, whichever is lower |
> Note: The CSR amount that remains unspent must be transferred to the Unspent CSR Account (for ongoing projects) or to a Schedule VII fund (for non-ongoing projects).
## 2. Meaning of CSR – CSR Rules, 2014
"CSR" means activities undertaken by a company in pursuance of its statutory obligation under Section 135, in accordance with the provisions of Schedule VII.
## 3. Activities EXCLUDED from CSR
The following do not qualify as CSR activities:
1. Sponsorship expenses undertaken for marketing benefits.
2. Political contributions (direct or indirect).
3. Activities benefiting only employees of the company and their families.
4. Expenses on discharging any statutory obligation under any other law.
5. Activities undertaken outside India (foreign activities).
- Exception: Training of Indian sportspersons representing the country at national or international level.
6. Activities carried out in the normal/ordinary course of business.
- Exception: Companies engaged in Research & Development (R&D) activities of new vaccines, drugs and medical devices related to COVID-19 for FYs 2020-21, 2021-22 and 2022-23 (subject to conditions).