Coal India Limited

(A Govt. of India Enterprises- A Maharatna Company)

"Coa! Bhavan"
CSR Department
Premise No. 04, Plot No. AF-l!!
Action Area tA, New Town, Rajarhat,
Kolkata -700156 (W.8.)
Phone: 033-23244173, Email : gmcsr.cil@coalindia. in

OFFICE MEMORANDUM

subject: Modified csR policy of coal lndia Limited

CIL Board in its 4L3th meeting held on L4th October 2O2O approved "Modified CSR policy of
Coal lndia Limited". A copy of the approved policy is enclosed for implementation in CIL and
its subsidiaries. CIL Board has also authorized subsidiary boards to delegate power to D(P) of
the concerned subsidiary to approve CSR projects upto a limit.

The modified CSR policy of CIL will supersede previous policy and administrative orders
issued earlier in this regard. The policy shallcome into force with immediate effect.

\
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tr\,v '
(S. K. Singh)
General Manager (HRD, CSR, Welfare & Aviation)

Distribution:

1. D(r)/D(P&tR)/D(F)/D(M), ct L
2. C M D, BCCLI CCL/ CM p D I L/ E C L/ M C L/ N C L/S EC L/WC L
3. CVO, CtL
4, D( p)/D( F), BCCL/ CCL/ EC L/M CLIN CLIS EC L/WCL
5. D(T/ES), CMPDTL
6. GM/TS to Chairman, CIL
7. G M/H oD (csR), BccL/CcL/cM P Dt L/ECL/McL/NcL/SEcL/wcL
8. GM, NEC
9. GM, NDLO
10. GM/HoD,llCM
11. HoD (System), CIL - with a request to please upload the same in CIL website for
information and compliance by all concerned.
 Modified Corporate Social Responsibility Policy of CIL

1. INTRODUCTION

The concept of Corporate Social Responsibility (CSR) has gained prominence from all avenues.
Organizations have realized that government alone will not be able to get success in its endeavor
to uplift the downtrodden of the society. With the rapidly changing corporate environment, Coal
lndia Limited (ClL) has adopted CSR as a strategic tool for sustainable growth. For CIL in the
present context, CSR means not only investment of funds for social activity but also integration of
business processes with social processes.

Even much before the issue became a global concern, CIL was aware of its Corporate Social
Responsibility and was fulfilling the aspiration of the society through well-defined "Community
Development Policy" within the periphery of 8 kilometers of its project sites. This has resulted into
a harmonious relationship between CIL and the peripheral communities.

As per clause 135 of Companies Act 2013, CSR committees of all eligible companies need to
formulate and recommend to the Board, a CSR policy which shall indicate the activities to be
undertaken by the company as specified in Schedule Vll.

ln the aforesaid backdrop, CSR policy of CIL has been framed after incorporating the features of
the Companies Act 2013, notifications issued by Ministry of Corporate Affairs (MCA) and
Department of Public Enterprises (DPE), Govt. of lndia from time to time and Companies
(Amendment) Act 2019 and broadly covers guidelines for the following: -

a. Welfare measures for the community at large, so as to ensure the poorer sections of the society
derive the maximum benefits
b.Contribution to the society by way of socialandculturaldevelopment, imparting education,
training and social awareness especially with regard to the economically backward classes for
their development and generation of income to encourage self-employment and dignified living
c. Protection and safeguard of environment and maintaining ecological balance

2. OBJECTIVE
The main objective of CSR policy is to lay down guidelines for CIL and its subsidiaries to make CSR
a key business process for sustainable development for the society. lt aims at supplementing the
role of the government in enhancing welfare measures of the society based on the immediate and
long term social and environmental consequences of coal mining.

3. AREAS TO BE COVERED
Mines of CIL and its subsidiaries are located in different parts of the country spread in eight states,
in relatively isolated areas. lntroduction of any production activity in such areas changes the
traditional lifestyle of the original inhabitants and indigenous communities and also changes the
socio-economic profile of the area. Mining of coal too has profound impact on the people living in
and around the areas where the mines are located. Hence, the primary beneficiaries of CSR
activities shall be, Project Affected Areas (PAAs) and those staying within the radius of 25
kilometers of the coal mining projects. CIL and subsidiaries shall ensure that the maximum benefit
of their CSR activities goes to the underprivileged sections of the society. CSR activities should be
undertaken as per Schedule Vll of Companies Act. 2013 and as per DPE guidelines issued from
time to time.
1lYt*;*
/

The following guidelines shall be followed in selection of areas for CSR activities

Subsidiaries of CIL shall spend 8Oo/o of the CSR fund of a yeat within the radius of 25
kilometers of their Project Sites/Mines/Area HQ/Company HQ and rest 20olo within the
state(s) in which they are operating. The above ratio of 80:20 may be dispensed with by
the subsidiaries for a particular year with the approval of its board through board level CSR
committee in case the Central Govt. issues any such guidelines/adminlstrative directions,
which the company has to otherwise comply with.

b. CIL (HO) shall execute CSR activities in whole of lndia including the areas under subsidiary
companies.

c. CIL (HO) being the holding company shall also support for execution of CSR
projects/programs where subsidiaries are unable to execute such project due to fund crunch.
ln case available CSR budget of any subsidiary company is insufficient to meet the fund
requirements of any govt. mandated CSR activity, the concerned subsidiary may refer the
duly approved CSR activityi project/program to CIL (HO) with the recommendation of seeking
financial assistance after competent authority approvals at the subsidiary level are taken. All
such requests would have to be fonnrarded by CSR Dept. of concerned subsidiary after
obtaining approval of its Board/CMD. lf CIL approves the activity/project/programme, the
activity shall be implemented by the concerned subsidiar,y whereas the expenditure will be
accounted _for by CIL (HO) against its CSR budget. CIL would finance such project subject to
approval of the competent authority at CIL and the same will be treated to be the project of
the subsidiary whose implementation and monitoring will rest on the concerned subsidiary.

4. ALLOCATION OF FUND

The following guidelines shall be followed for allocation of fund for CSR activities during the financial
year:

a For subsidiaries of ClL, fund for CSR shall be allocated based on whichever is higher of the
following two amounts:

i. 2o/o of average net profit of the company for the three immediate preceding financial
years, as per Companies Act 2013 or
ii. Rs. 2.00 per tonne of coal production of immediately preceding financial year

b. For CIL (HQ), fund for CSR shall be allocated based on whichever is higher of the following
two amounts:

i. 2o/o of average net profit ofClL (standalone) for three immediate preceding
financial
years, as per Companies Act 2013 or
ii. Rs. 2.00 per tonne of total coal production of immediate preceding financial year of
those subsidiaries of CIL which had not incurred nei loss in the immediately
preceding fi nancial year

Example - CSR budget for FY 19-20 has been calculated as per the above provisions and is
enclosed as Annexure 1.

c. The unspent amount of CSR budget in a financial year would be accounted

for as per the
provisions of Companies Act 2013, as notified.
 \

5. SCOPE

CIL and its subsidiaries would undertake select CSR activities out of the themes listed in Schedule-
Vll of the Companies Act 2013 as amended from time to time. The themes in the scope of CSR
policy must be interpreted liberally so as to capture the essence of the subjects enumerated in
Schedule Vll of Companies Act, 2013. Any modifications in Schedule Vll of Companies Act 2013 or
directions from DPE or MOC shall also deemed to have been incorporated in the scope of CSR
policy of CIL from the date of such changes being notified by the Government.

6. INSTITUTIONALARRANGEMENT

CIL and subsidiaries having net worth of Rs. 500 crores or more, or turnover of Rs. 1000 crores or
more, or a net profit of Rs. 5 crores or more during any financial year shall constitute a Board Level
Committee on CSR consisting of three or more Directors, out of which at least one Director shall
be an lndependent Director. The Committee shall monitor and review the progress ofCSR activities
from time to time.

CSR department at CIL and subsidiaries shall act as nodal department for implementation of CSR
activities in accordance with the CSR policy under the guidance of Director (P&lR), CIL and
concerned Director (P) of subsidiary companies as the case may be.

CIL and subsidiaries shallform inter-disciplinary committees with senior executives from CSR, Civil,
Finance, Medical etc. to review the CSR projects scrutinized by the CSR department and
recommend them for approval of competent authority. Based on the recommendation of CSR
department, CSR project proposals/programmes/activities shall be deliberated in the meeting of
these committees who in turn shallexamine and submit its recommendation to competent authority
for approval through Dir. (P&lR)/Dir. (P), as the case may be. Similar committees may also be
formed at area level in subsidiaries.

Delegation of Power (DOP) to approve CSR projects/activities at subsidiaries of CIL shall be as

under:

. Projects/activities to be undertaken by mining areas having value up to Rs. 5.00 lakhs shall
be approved by concerned Area General Managers.
. Projects/activities to be undertaken by mining areas having value more than Rs. 5.00 lakhs
but up to Rs. 1.00 crore and all projects/activities of HQ up to Rs. 1.00 crore shall be
approved by CMD of the subsidiary company.
. P0ects/activities having value more than Rs. 1.00 crore shall be approved by subsidiary
Board on recommendation of CSR committee of Board.

Delegation of Power (DOP)to approve CSR projects/activities at CIL (HQ) shall be as under:

. Projects/activities having value up to Rs. 2.50 crores shall be approved by Chairman, ClL.
. Projects/activities having value more than Rs. 2.50 crores but up to Rs. 10.00 crores shall
be approved by CSR committee of CIL Board.
o projects/activities having value more than Rs. 10.00 crores shall be approved by CIL Board
on recommendation of CSR committee of CIL Board'
r For North Eastern Coalfields (NEC), projects/activities having value up to Rs' 5.00 lakhs
shall be approved by General'Manager (UgC). A monthly repo_rt is.to^be sent to Director
(Technicai), ctt- tor his review by NEC. Annual CSR action plan for NEC is to be cleared by
birector (Technical), CIL for inclusion in the annual plan q1d budget for CSR of CIL which
is to be approved 6y CIL Board. Projects/activities of NEC having value above Rs. 5.00
3l$)a'+*
 lakhs shall be approved by concerned authorities of CIL (HQ) as per their DOP on
recommendation of GM (NEC) and the functional director concerned.

Chairman, CIL/Subsidiaries are empowered to approve modalities/Standard Operating Procedures

for implementation of CSR works as per CSR policy,

7. IMPLEMENTATION
The following guidelines/modalities shall be followed while executing/undertaking CSR activities:

1. Around the beginning of every financial year, CSR departments of CIL and Subsidiaries will
design an Annual Action Plan for the projects to be undertaken during that year taking into
account Govt. directives as are applicable (e.9. annual theme, aspirational district), company
priorities, prior-commitments, budgetary limitations, workability of the projects. The Annual
Action Plan would be executed once the same is approved by the Board of the respective
Company on the recommendation of the CSR Sub-Committee of the Board.

2. Activities under CSR except those relating to contribution to funds specified in Schedule Vll
shall be in project mode and for every project, time framed periodic milestones should be
finalized at the outset.

3. As far as possible, the project should be completed within 2yearsfrom the start and in no case,
projects with duration exceeding three years from the start date shall be undertaken. The date
of starting of work or release of first instalment, whichever is earlier, shall be considered as
project starting date and that year shall be considered as project start year.

4. Activities identified under CSR shall be implemented either by CIL/subsidiaries departmentally

or through implementing agencies which may include:
a. Trusts
b. Societies
c. Section 8 companies
d. Government, semi- government and autonomous organizations
e. lnstitutes/Academic organizations
f. Registered community based organizations
g. Registered voluntary/Not for profit organizations
h. Registered self-help groups
i. Contractual agencies for civilworks
j. Professionalconsultancyorganizationsetc.

5' lmplementing agencies having only local presence shalt only be considered by small value
projects.

6' Need and justification of all CSR projects/activities shall have to be ascertained. Need
assessment shall be carried out either departmentally using
in house expenise or throuth
external reputed agencies including implementing agencies. Nleed
may be based
on already conducted web surveys, indices, r6se"arcn pup"ri-a"rr"..r"rt
ilport",
demographic & development stuciy reports, DPE surveys, census reports,
'methods various il/inistrylcovt. Reports
&publications etc' wherever required
interviews, participatory research exercises,
;r.h as household surveys, stakeholder
baseline rrr"y, etc. may also be used.

7 ' The suggestions given by the elected representatives/bodies

shall be duly considered while
4l
 finalizing the CSR activities

8. Memorandum of Understanding (MoU) shall be signed with all implementing agencies for
projects having value more than Rs.5.00 lakhs.

9. Board level CSR committee of CIL and subsidiaries would decide from time to time, the projects
for which impact assessment is to be done.

10. CIL and its subsidiaries as per their need and till their internal expertise is developed may
appoint consultants/reputed institutes/paid interns from reputed institutes following due
process, for evaluation of proposals reckonable as CSR proposals, need assessment or impact
assessment of CSR projects. The expenditure incurred on engagement of consultants for CSR
works may be included in the administrative expenditure, subject to limits as prescribed in the
Companies AcUCSR rules of Min. of Corp. Affairs from time to time.

11. Assets created from CSR funds shall strictly be for the benefit of the intended beneficiaries and
maintenance of such assets shall be the responsibility of the concerned implementing
agency/state governmenVlocal body/beneficiary community unless specifically taken up as a
project component by CIL and subsidiaries.

12. The surplus arising out of CSR projects or programmes or activities shall not form part of the
business profit of CIL and its subsidiaries.

13. For contribution towards setting up educational institutes, CIL/Subsidiaries should support only
Govt. Universities / Public Sector lnstitutes and such supports should be through matching
grants in normal cases and in exceptional cases, Cll/Subsidiary Board may decide to go
beyond matching grant for reasons to be recorded in writing.

8. DATA MANAGEMENT

All the data related to CSR shall be maintained on real time basis with inbuilt mechanism for
periodic report generation, having details of expenditure, project closure, beneficiaries with
category wise (SC,ST,OBC,PWD), gender wise and age group (Children, Senior Citizens, Others)
wise breakup etc. to the extent feasible. There shall be a common formaUdata sheet for all
companies to maintain the indicators/data. Head of CSR departments at CIL and subsidiaries shall
ensure the implementation of the information system.

9. MONITORING AND REPORTING

The following guidelines shall be followed for monitoring CSR activities:

1. The CSR Committee of Boards at CIL and its subsidiaries shdll monitor the progress of
work of ongoing projects from time to time and case to case basis.

2. Utilization Certificate with statement of expenditure duly certified by a Practicing

Chartered AccountanVAuthorized Auditor shall have to be submitted by the implementing
agencies for the CSR fund provided to them as a one-time grant or in installments.
3. CSR departments at CIL and subsidiaries shall monitor the CSR projects/activities
periodically and shall prepare the Annual Report on CSR Activities for placing the same
before the respective Boards through CSR Committee of Board.

5 | T) ;:e ;::t ?:"':

 4. Board level CSR committee of CIL and its subsidiaries would decide which of the CSR
projects are to be audited by an external auditor to be appointed with the
recommendation of the CSR subcommittee.

5. The expenditure incurred on such audit of CSR activities may be included in the
adm inistrative expenditure.

6. Meticulous documentation relating to CSR activities and expenditure shall be prepared

and put on the respective websites by CIL and subsidiaries.

7. CIL and subsidiaries shall take CSR mileage by leveraging print, electronic and digital
media.

10. DUE DILIGENCE

CIL and its subsidiaries would comply with all statutory provisions on CSR and the amendments
thereto, as promulgated from time to time. CIL and its subsidiaries would also comply with all rules,
regulations, guidelines, orders, directives or any such communication issued by the Central Govt.
from time to time.

11. LIMITATION AND AMENDMENT

The CSR policy of company will be governed by provisions under Companies Act, 2013 or any
other act that may be introduced, Government guidelines and any other govt. instructionl
applicable from time to time.
*******

6 l'i::i ,'i i:; :;"1'

 Annexure 1- Example: Calculation of CSR Fund allocation for FY 19-20 by CIL and its
subsidiaries as per revised CSR Policy
Amount as
Average of 2 % of Avg. per Rs. 2 per
Net Coal CSR Budget
Net Profit of Net Profit of tonne of
Profit FY Production - Higher of
Subsidiary FY 16-L7 to FY 16-17 to FY coal
18-19 of FY 18-19 CandE
FY 18-19 18-19 production
(Rs. cr.) (MT} (Rs. cr.)
(Rs. cr.) (Rs. cr.) of FY 18-19
(Rs. cr.
A B c D E F
ECL L295.23 -52.23 -L.04 50.16 10.03 10.03
BCCL 557.05 -610.43 -L2.2L 3L.04 6.21 6.2L
CCL 2692.20 2L36.47 42.73 68.72 13.7 4 42.73
NCL 6659.16 46L3.32 gZ,Z7 101.s0 20.30 92.27
WCL r93.72 -L237.02 -24.74 53.18 10.64 L0.64
SECL 5570.67 4L92.7 4 L57.35 3L.47 83.8s
MCL 9281.08 7825. L5 r', : .15fi.50 L44.15 28.83 156.50
CM PDIL 263.82 1s0.06 3.00 0.00 0.00 3.00

CIL (Sta nda Ione) 168.00 404.23 8.08 606.89 t.f:f .i}8 12r.38

Explanation

1. For CCL, NCL, SECL and MCL

2%o of average net profit of FY L6-17 to FY 18-19 is more than Rs. 2 per tonne of coal production
of FY 18-19, hence the former is taken as their csR fund allocation for Fy 19-20
2.For CMPDIL
It does not have any coal production hence 2Yo of average net profit of FY 76-17 to FY 18-19 has
been taken as its CSR fund allocation for FY 19-20
3. For ECL, BCCL and WCL
Rs. 2 per tonne of coal production of FY 18-19 is more than 2% of pverage net profit of FY 1.6-17
to FY 18-19, hence the former is taken as their csR fund allocation for Fy 19-20
4. For CIL
All the subsidiaries have made net profit in FY 18-19, hence for calculating Rs. 2 per tonne of coal
production of FY 18-19, coal production of all the subsidiaries and NEC is considered.

Rs. 2 per tonne of coal production of FY 1-8-19 as calculated above is more than 2% of average
net profit excluding dividend income of FY 16-17 to FY 18-1-9. Hence the former is taken as its
CSR fund allocation for FY 19-20.