Getting funds from foreign entities for your non-profit venture requires certificate under FCRA from the Government. Contact Filecrat to get yours now!
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Acceptance and utilisation of every kind of contribution received from foreign entities is regulated by the Ministry of Home Affairs as per the Foreign Contribution (Regulation) Act, 2010 (hereinafter FCRA). The law can prohibit the recipient Indian individuals, charitable trusts, societies, companies and other organisations from receiving funds for any activity which is against national and social interest. The Government has cancelled thousands of charitable organisations licenses for non-compliances earlier.
Types of FCRA Registration
- Proper registration through Form FC-3A
- Prior permission through Form FC-3B
Required Eligibility for a Private Company to Receive Foreign Contribution
- FCRA Registration/ prior permission from central government
- It must be for a purpose of cultural, educational, religious and other social benefits.
- It should not be under prohibited category mentioned under FCRA which includes:
- Candidate for election
- Correspondent, columnist, cartoonist, editor, owner of a company or printer and publisher of a registered newspaper
- Judge, government servant or employee of any corporation
- Entity controlled or owned by the Government
- Member of any Legislature
- Political party or its office-bearer
- Organisation of a political nature
- Association or company engaged in the production or broadcast of audio news or audio-visual news or current affairs programmes through any electronic mode
- Acceptance on behalf of any political party
Authorized Receivers of Foreign Contribution
- Hindu Undivided Family
- Company registered under Section 8 of Companies Act, 2013
Registration under FCRA is subjected to following criteria:
- An association with minimum three years of existence
- An association which has performed welfare activities worth minimum 10 lakhs over last three years in its selected field(s) for the benefits of the society
- An organisation registered under any of the following legislations:
- Charitable and Religious Trusts Act,1920
- Indian Trusts Act, 1882
- Indian Societies Registration Act, 1860
Prior permission under FCRA is subjected to following criteria:
- Newly registered entity is willing to take foreign contribution.
- FCRA Prior Permission will be required if there are common members in Indian recipient and foreign donor organisation, subjected to following conditions:
- Minimum 51 percent members of recipient organisation should not be a member of donor organisation.
- The governing members of the recipient organisation should not be the members of donor organisation.
- Minimum 51 percent of employees or members of the governing body of the recipient organisation should not be the family members or close relatives of the donor (if there is an individual foreign donor).
Conditions for Both Registration and Prior Permission
Registration and prior permission both are subjected to following criteria:
- The person making an application for registration has undertaken reasonable activity in its chosen field for the benefit of the society for which the foreign contribution is proposed to be utilised
- The person making an application for giving prior permission has prepared a reasonable project for the benefit of the society for which the foreign contribution is proposed to be utilised
- In case the person being an individual, such individual has neither been convicted under any law for the time being in force nor any prosecution for any offence pending against him
- In case the person being other than an individual, any of its directors or office bearers has neither been convicted under any law for the time being in force nor any prosecution for any offence is pending against him.
- The acceptance of foreign contribution by the person referred to in point A is not likely to affect prejudicially either of the following:
- Sovereignty and integrity of India
- Security, strategic, scientific or economic interest of the State
- Public interest
- Freedom or fairness of election to any Legislature
- Friendly relation with any foreign State
- Harmony between religious, racial, social, linguistic, regional groups, castes or communities
- The acceptance of foreign contribution shall not lead the following:
- Incitement of an offence
- Endangerment of the life or the physical safety of any person
- The person making an application for registration or grant of prior permission:
- Is not fictitious or benami
- Has not been prosecuted or convicted for indulging in activities aimed at conversion through inducement or force, either directly or indirectly, from one religious faith to another
- Has not been prosecuted or convicted for creating communal tension or disharmony in any specified district or any other part of the country
- Has not been found guilty of diversion or mis-utilisation of its funds
- Is not engaged or likely to engage in propagation of sedition or advocate violent methods to achieve its ends
- Is not likely to use the foreign contribution for personal gains or divert it for undesirable purposes
- Has not contravened any of the provisions of this Act
- Has not been prohibited from accepting foreign contribution
Exemption from Registration/ Prior Permission
- Donation from personal savings of an NRI (Non-Resident Indian) through normal banking channels
- Foreign remittances from relatives amounting less than one lakh in a financial year.
Note: Any remittance of more than one lakh is required to inform the Central government through Form FC-1 within 30 days of the date of receipt.
- Donation received by any Indian government department.
- Consultation with our Experts
- Drafting of Application form
- Filing of final form
- Reply to one clarification from authorities
- Obtaining Certificate
- Self-attested copy of registration certificate of association
- Memorandum of association (MoA)/ Trust Deed
- Affidavit of each key functionary
- Signature of chief functionary (JPG/ JPEG format)
- Seal of the Association (JPG/ JPEG format)
For the purpose of registration:
- Activity report for the last 3 Years
- Audited statement of income and expenditure of last three financial year
For the purpose of Prior Permission:
- Commitment letter from the donor organization and agreement stating the amount and purpose of donation
- Project report for which FC will be received.
Yes, this is important to open the bank account in a bank from the list of 60 banks integrated with PFMS available here
Yes, this is mandatory after registration and prior approval to file annual returns through Form FC-4 accompanied along with scanned copies of income and expenditure statement, balance sheet and statement of receipt and payment within 9 months from the last day of a financial year (December 31).
It is accepted only by online mode through form FC-4.
Every person, who is registered and granted a certificate or given prior permission under this Act and receives any foreign contribution:
- Shall utilize such contribution for the purposes for which the contribution has been received
- Shall not defray as far as possible such sum, not exceeding fifty per cent of such contribution, received in a financial year, to meet administrative expenses
Yes, these types of incomes will fall under the scope of Section 2(1)(h) of FCRA, 2010 and will be considered as foreign contribution.
There is no rectification allowed after the final submission of online forms but in case of any error support centre or help desk of FCRA can be contacted.
Filing of form FC-3C will be required for the renewal of registration before 6 months from the expiry of five years of registration.
All FCRA related services like Registration, Renewal, Filing of Returns shall require DARPAN Unique ID. All NGOs now need to acquire DARPAN Unique ID from the portal offered by NITI Aayog in association with National Informatics Centre.