CORPORATE SOCIAL RESPONSIBILITY POLICY

Approving Authority Board of Directors of Harsha Engineers International Limited (formerly

known as Harsha Engineers International Private Limited and Harsha Abakus
Solar Private Limited) (“the Company”)
Adopted on 10th Jan 2022
Effective Date This policy on corporate social responsibility of the Company (“CSR
Policy / Policy”) shall come into effect from the date of its approval, i.e.
adoption in the meeting of the Board of Directors.

1. OBJECTIVE

The objective of this Policy document is to articulate Company’s philosophy of social

responsibility, to define the area chosen by the Company to impact the Society with its efforts
towards corporate social responsibility and to define the governance & monitoring framework for
ensuring effectiveness of the Policy.

This Policy has been prepared in consonance with Section 135 of the Companies Act, 2013,
(“Act”) Companies (Corporate Social Responsibility Policy) Rules, 2014 (“Rules”) as amended.
For the purpose of this Policy, the Act, the Rules and Schedule VII as amended from time to time,
are hereinafter referred to as the (“CSR Legal Framework”). The CSR Policy shall apply to all
corporate social responsibility (“CSR”) activities undertaken by the Company as per the CSR
Legal Framework.

2. Definition:

Words and expressions used in this Policy and not defined specifically in this document shall
have the meanings respectively assigned to them under the CSR Legal Framework.

3. PHILOSOPHY

CSR is the Company’s commitment to its stakeholders to conduct business in an

economically, socially and environmentally sustainable manner that is transparent and ethical.
The Company believes that corporate development has to be inclusive and every corporate has to
be responsible for the development of a just and humane society that can build a national
enterprise. The Company commits itself to contribute to the society in ways possible for the
organisation.

4. KEY THRUST AREAS AND APPROACH TO CSR ACTIVITIES

While the Central Government of India has spelt out the CSR activities under Schedule VII to the
Act, in order to build focus and have more impactful execution, the Company’s CSR efforts will
be primarily dedicated in following areas:

Person with With the vision to create and environment which can provide meaningful
intellectual and opportunities to persons with intellectual and development disabilities, so
development that they can live an active and independent life, develop occupational
disabilities skills, get the warmth of a family , and get assimilated in society
Education Access to quality education and skill enhancement
Health Affordable solution for healthcare
Environment Environment sustainability, ecological balance, conservation of natural
resources

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 Disaster Response Managing and responding to disaster

However, in addition to aforesaid key thrust area, the Company is committed to attend to any of
activities outlined in Schedule VII as amended from time to time which the CSR Committee and
Board of Directors may consider and approve as a part of CSR Activities.

5. COVERAGE AND SELECTION of CSR ACTIVITIES

The CSR Activities shall be undertaken in locations within India and preferably within (but not
limited to) the local areas around which it operates.

The CSR activities (“CSR Activities”) shall mean the activities undertaken by a Company in
pursuance of its statutory obligation laid down under the CSR Legal Framework and shall not
include activities specifically excluded under the CSR Legal Framework, presently being:
 Projects or activities not falling within purview of Schedule VII (Annexure 1),
 Activities undertaken in pursuance of normal course of business of the Company,
 any activity undertaken by the Company outside India except for training of Indian sports
personnel representing any State or Union territory at national level or India at international
level,
 Direct or indirect contribution to any political party under Section 182 of the Act,
 activities benefitting employees of the Company as defined in clause (k) of section 2 of the
Code on Wages, 2019,
 Activities supported by the Company on sponsorship basis for deriving marketing benefits
for its products or services.
 activities carried out for fulfilment of any other statutory obligations under any law in force
in India.

6. CSR COMMITTEE

The CSR Committee shall be constituted in accordance with the CSR Legal Framework and
shall meet as often as its members may deem necessary to perform inter-alia the following
duties and responsibilities:

i. Formulate and recommend to the Board, the CSR Policy; identify specific CSR
programmes/ projects areas to be undertaken by the Company
ii. Recommend to the Board for its consideration and approval CSR Activity and the
projects to be undertaken and amount of expenditure to be incurred thereunder,
iii. Formulate and recommend to the Board, an annual action plan pursuant to this Policy,
which shall include such details as may be prescribed under the CSR Legal Framework
from time to time.
iv. Monitor the CSR Policy and execution of CSR Activities from time to time and
recommend changes to the Board if necessary,
v. Prepare an annual report of the CSR Activities undertaken for each financial year and
submit such report to the Board,
vi. Undertake impact assessment through an independent agency, of CSR projects having
outlay of Rs. 1 Crore or more, if any, and which have been completed not less than one
year before undertaking the impact study, in the event Company’s average CSR
obligation is of Rs. 10 crore or more in immediately 3 preceding financial years or as may
be prescribed under the CSR Legal Framework and place such Report before the Board,
vii. Any other matter as the CSR Committee may deem appropriate after approval of the
Board of Directors or as may be directed by the Board of Directors, or as may be
specified under CSR Legal Framework, from time to time.

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7. RESPONSIBILITIES OF THE BOARD

i. Approving the CSR Policy, annual action plan, CSR Activities and projects and the CSR
expenditure after taking into consideration, the recommendations made by the CSR
Committee or any modification there under,
ii. The Board may alter annual action plan at any time during the financial year, as per the
recommendation of CSR Committee, based on reasonable justification to that effect.
iii. Ensure the CSR spending for every financial year of at least 2% of average net profits
made during immediately preceding 3 financial years, in pursuance with this CSR Policy.
If the Company fails to spend the aforesaid amount then the Board’s Report prepared
under section 134 of the Act, shall specify the reasons for not spending the amount and
transfer the same as specified under this Policy and CSR Legal Framework.
iv. Ensure that CSR Activities included in the CSR Policy are undertaken by the Company
and such activities are related to the activities specified in CSR Legal Framework.
v. Ensure that the CSR Activities are undertaken either by the Company itself or through
Implementing Agency, as permitted under the CSR Legal Framework.
vi. In case of ongoing projects, monitoring the implementation of the project in line with the
approved timelines and year – wise allocations and shall be further authorized to make
modifications thereto if required subject to the same being within the overall permissible
time period.
vii. Satisfy itself that the funds have been utilized for the purpose and in the manner, as
approved by them and the Chief Financial Officer / person responsible for the financial
management of the Company, to certify to the effect.
viii. Ensure the administrative overheads shall not exceed the limits specified under the CSR
Legal Framework, presently being 5% of total CSR Expenditure of the Company for each
Financial Year.
ix. Ensure any surplus arising out of the CSR Activities shall not form part of the business
profit of the Company and shall be ploughed back into the same project or be transferred
to the Unspent CSR Account and spent in pursuance of CSR Policy and Annual Action
Plan of the Company or transfer such surplus amount to the Fund specified in Schedule
VII within the stipulated period of time.
x. Ensure that surplus or unspent amount earmarked for CSR in any financial year is given
effect as required under the CSR Legal Framework.
xi. Approve the set off of the excess amount of CSR spent in a financial year, against CSR
spent of upto immediate next three financial years;
xii. Ensure that Directors’ Report includes:
 Contents of the CSR Policy and Composition of the CSR committee;
 An annual report on the CSR in the prescribed format;
 Reasons for failure (if any) to spend required amount on CSR Activities.

8. CSR EXPENDITURE

i. In every financial year, the Company shall spend a minimum of 2% of its average Net
Profits of the immediately preceding three (3) financial years, as computed in accordance
with the provisions of the CSR Legal Framework or such sums as specified under the
CSR Legal Framework, towards CSR Expenditure. The administrative overheads shall
not exceed the limits specified under the CSR Legal Framework, presently being 5% of
total CSR Expenditure of the Company for each Financial Year.
ii. If the Company is required to undertake impact assessment pursuant to CSR Legal
framework then such expenditure can be booked towards Corporate Social Responsibility
for a given financial year, which shall not exceed five percent of the total CSR expenditure
for a given financial year or fifty lakh rupees, whichever is less.

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9. TREATMENT OF UNSPENT / EXCESS AMOUNTS IN RESPECT OF CSR
ACTIVITIES AND SURPLUS ARISING OUT OF CSR ACTIVITIES

The Company shall ensure that any unspent amount under its CSR obligation, excess spent
amount toward CSR expenditure and/or surplus arising out of the CSR Activities shall be
treated in accordance with the CSR Legal Framework and as may be approved by the Board,
from time to time.

10. IMPLEMENTION

i. The Company shall undertake its CSR Activities directly itself or through Implementing
Agencies and/in in such manner as may be prescribed under the CSR Legal Framework.
Such Implementing Agency shall be either:
 A company under Section 8 of the Act, registered public trust or registered society
established by the Company either singly or along with other Company and has
valid registration under section 12A and 80G of the Income Tax Act, 1961.
 A Company established under Section 8 of the Act, registered trust or registered
society, established by the Central or State Government.
 Any entity established under an Act of Parliament or State Legislature.
 A Company under Section 8 of the Act registered public trust or registered society
with a valid registration under section 12A and 80G of the Income Tax Act,
1961 with a track record of atleast 3 years in undertaking similar activities.
Provided that the aforesaid implementing agencies shall be considered eligible if it is in
compliance with the provisions of the CSR Legal Framework.
ii. The Company may also collaborate with other companies to undertake CSR Activities in
such a manner that each company is in a position to report separately on such CSR
projects.
iii. While partnering with Implementing Agency, the credentials of such entities will be
verified, and all requisite information and documentation as listed in Annexure 2 would
be obtained and necessary documentation would be completed.
iv. CSR programmes/ projects to be undertaken by the Company will be identified by the
CSR Committee.
v. The CSR Committee shall recommend the CSR programmes/ projects, specifying
modalities of its execution and the amount of expenditure to be incurred on the
programmes/ projects.
vi. Upon recommendations of the CSR Committee, the Board shall specifically approve such
CSR projects/programs and the amount of expenditure.
vii. The Company may engage international organisations for designing, monitoring and
evaluation of the CSR projects or programmes as the CSR Committee and/or the Board
may deem fit as well as for capacity building of the own personnel for CSR.

11. MONITORING

i. The Company shall regularly monitor the annual action plan, CSR Activities and the CSR
projects.
ii. The CSR Projects taken up through Implementing Agency shall be monitored &
evaluated at regular intervals.

12. GENERAL

Any or all provisions of the CSR Policy would be subject to revision/amendment by the CSR
Committee in accordance with the CSR Legal Framework and any other guidelines on the

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subject as may be issued by the Central Government from time to time.

In case of any conflict between provisions of this Policy and the CSR Legal Framework, the
provisions of CSR Legal Framework shall supersede. Notwithstanding the absence of any
provisions of the CSR Legal Framework in this Policy, the Company shall comply with such
provisions as if they are part of the CSR Policy.

The CSR Committee or any person so authorised by the Board shall settle all queries,
differences or doubts that may arise in relation to the implementation of the CSR Policy and
CSR programmes/ projects as may be approved by the Board.

__________

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 ANNEXURE 1

CSR activities Listed in Schedule VII of the Companies Act, 2013

(as on the date of adoption of the Policy)

i. Eradicating hunger, poverty and malnutrition, promoting health care including preventive
health care and sanitation including contribution to the Swach Bharat Kosh set-up by the
Central Government for the promotion of sanitation and making available safe drinking
water.
ii. promoting education, including special education and employment enhancing vocation
skills especially among children, women, elderly and the differently abled and livelihood
enhancement projects.
iii. promoting gender equality, empowering women, setting up homes and hostels for women
and orphans; setting up old age homes, day care centres and such other facilities for senior
citizens and measures for reducing inequalities faced by socially and economically
backward groups.
iv. ensuring environmental sustainability, ecological balance, protection of flora and fauna,
animal welfare, agroforestry, conservation of natural resources and maintaining quality of
soil, air and water including contribution to the Clean Ganga Fund set-up by the Central
Government for rejuvenation of river Ganga.
v. protection of national heritage, art and culture including restoration of buildings and sites
of historical importance and works of art; setting up public libraries; promotion and
development of traditional art and handicrafts;
vi. measures for the benefit of armed forces veterans, war widows and their
dependents, Central Armed Police Forces (CAPF) and Central Para Military Forces
(CPMF) veterans, and their dependents including widows;
vii. training to promote rural sports, nationally recognised sports, Paralympic sports and
Olympic sports
viii. contribution to the prime minister's national relief fund or Prime Minister’s Citizen
Assistance and Relief in Emergency Situations Fund (PM CARES Fund)] or any other
fund set up by the central govt. for socio economic development and relief and welfare of
the schedule caste, tribes, other backward classes, minorities and women;
ix. (a) Contribution to incubators or research and development projects in the field of science,
technology, engineering and medicine, funded by the Central Government or State
Government or Public Sector Undertaking or any agency of the Central Government or
State Government; and
(b) Contributions to public funded Universities; Indian Institute of Technology (IITs);
National Laboratories and autonomous bodies established under Department of Atomic
Energy (DAE); Department of Biotechnology (DBT); Department of Science and
Technology (DST); Department of Pharmaceuticals; Ministry of Ayurveda, Yoga and
Naturopathy, Unani, Siddha and Homoeopathy (AYUSH); Ministry of Electronics and
Information Technology and other bodies, namely Defense Research and Development
Organisation (DRDO); Indian Council of Agricultural Research (ICAR); Indian Council of
Medical Research (ICMR) and Council of Scientific and Industrial Research (CSIR),
engaged in conducting research in science, technology, engineering and medicine aimed at
promoting Sustainable Development Goals (SDGs).
x. rural development projects
xi. slum area development (‘slum area’ shall mean any area declared as such by the Central
Government or any State Government or any other competent authority under any law for
the time being in force)
xii. disaster management, including relief, rehabilitation and reconstruction activities; and
xiii. such other activities as may be permitted under the Act, from time to time.

Further due to outbreak of the novel Corona Virus (COVID-19) pandemic, Ministry of Corporate
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Affairs vide its General Circular No. 10/2020 dated March 23, 2020 has clarified that various
activities related to COVID-19 under item nos. (i) and (xii) as listed above of Schedule VII of the
Act relating to promotion of health care, including preventive health care and sanitation, and,
disaster management are eligible as CSR Activity.

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 ANNEXURE 2

Indicative list of aspects to be considered while engaging with other entities

Due diligence of the implementing agency should be conducted to check the credentials of the
organization and to ensure that its projects / programmes / activities are consistent with the CSR
Legal Framework and CSR Policy. The following documents / information from the interested
Implementing Agencies would be sought, as applicable:

 Memorandum of Association and Articles of Association/ Constitutional Document

 Registration certificate under application law;
 Audited financial statements / Accounts for the last three years
 Registration Certificate under Section 80G and 12A of the Income Tax Act, 1961
 Permanent Account Number (PAN) card issued under the Income Tax Act, 1961
 Details of Projects attended in last 3 Years.
 Details of the entity’s organizational structure, capability, technical skills and manpower
resource.
 Such other documents / certificates / details as may be required to assess the eligibility of
the Implementation Agency under the CSR Legal Framework or any other applicable law
for the time being in force.

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