Possibilities Of Foreign Funds With Fcra Registration

By Author: mukeshji kumarji
Total Articles: 442
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FCRA is an act that came in force in May 2011 with an objective to regulate the utilization of foreign aid by certain persons or associations so that the aided organizations could work in consonance with the principals of a democratic republic. Foreign contribution means the donation, delivery or transfer made by any foreign source :

1) Of any article, not being an article given to a person as a gift for his personal use, if the market value, in India, of such article, on the date of such gift, is not more than such sum as may be specified from time to time, by the Central Government by the rules made by it in this behalf;

2) Of any currency, whether Indian or foreign;

3) Of any security as defined in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956 and includes any foreign security as defined in clause (o) of section 2 of` the Foreign Exchange Management Act, 1999. Organizations may seek foreign contribution for definite cultural, social, economic, educational or religious programs either after registering themselves or after obtaining prior permission from ministry of Home affairs. ...
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Prior Permission:

Application for getting prior permission or receiving foreign contribution may be made to Ministry of Home Affairs in the prescribed form FC-1A. Along with the application form, a commitment letter from the donor foreign source is also mandatory to be submitted after receipt of the application, the same is processed by MHA. Generally, associations which are new or are in informative stage but are caring programmes in the cultural, social, educational, economic and religious fields are granted prior permission. Such associations are required to produce annual returns in context of utilization of foreign contribution to MHA in FC-3 form duly certified by chartered accountant.

Registration and Process:

Any person or association may apply for obtaining grant of registration to receive foreign contribution to Ministry of Home Affairs in the FC-8 Form. Then, on receipt of the application, it is processed by MHA according to the provisions of the Act. Generally, registration is granted to such associations or persons who are carrying genuine work in their chosen field of work. Associations verification certificates are submitted in the prescribed format get registrations within a fortnight of submission of application. After the grant of registration, the association can receive funds from any foreign source but it has to furnish its utilization details to ministry of Home affairs. Generally registration applications are processed within six months of the receipt of application.

Any organization having a definite cultural/ social/ educational/ religious/ economic object shall only accept foreign contribution after satisfying two conditions:

(i) It must register itself with the Central Government.
(ii) It must agree to receive foreign contribution only through one specific bank account.

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