Introduction
According to Section 6(1) of the Foreign Contribution Regulation Act of 2010, charitable trusts, societies, and Section 8 companies that accept donations or contributions from abroad must register. An FCRA registration is one such registration made under the Foreign Contribution Regulation Act, of 2010.
Eligibility Criteria for FCRA Registration
Organizations looking to receive foreign donations for specific cultural, social, economic, educational, or religious programs may register with the FCRA or use the "prior approval" approach to receive foreign contributions. A Trust, Society, or Section 8 Company is preferred as an FCRA applicant.
The not-for-profit organization must also have been operational for at least three years before filing the FCRA application, and it must not have previously accepted any foreign contributions without the government's consent. Additionally, the organization applying for registration must have invested at least Rs. 10,00,000 in its goals and objectives over the previous three years, excluding administrative costs. To demonstrate that it satisfies the financial requirement, statements of income and expenditure for the last three years that have been properly audited by a Chartered Accountant must be produced.
A newly registered entity can request prior permission (PP) from the Ministry of Home Affairs to receive foreign contributions for a specified activity, specific purpose, and from a specific source.
There are two ways to obtain the FCRA Registration authorization to accept foreign contributions.
The first step is to register with the FCRA, and
The second is to obtain prior permission under the FCRA.
What are the requirements for FCRA registration eligibility?
NGOs that wish to accept donations from abroad must register under existing laws, such as the Indian Trust Act of 1882, the Societies Registration Act of 1860, or section 25 of the Companies Act (now section 8 of the Companies Act of 2013), among others.
No NGO should not be found guilty of an offense or face legal action for it.
The NGO must have been in operation for at least three years and must have spent at least INR 15 lakhs over the previous three years on economic, social, educational, and religious purposes.
Requirements for FCRA Registration
The following criteria are checked when an FCRA application has been submitted in the required format before registration is granted.
The "person" or "organization" submitting the request for registration or prior authorization-
Neither fabricated nor benami
Has not been charged or found guilty for engaging in acts intended to persuade or coerce, directly or indirectly, the conversion of one religious belief to another;
Has not been charged or found guilty of inciting racial tension or unrest in a particular area or elsewhere in the nation;
Has not been held responsible for misusing or diverting its funds;
Is neither promoting sedition nor likely to do so and does not promote using violence to further its goals;
Is unlikely to transfer the foreign contribution for improper reasons or utilize it for personal benefit;
Has not violated any of the rules outlined in this Act;
Has not been forbidden from taking contributions from abroad; As an individual, this person has not been found guilty of a crime under any currently in effect laws and no legal action is presently being taken against him.
The person neither has been convicted of a crime under any currently in effect laws nor is being investigated for a crime against any of its directors or office holders.
The entity's or person's acceptance of a foreign contribution is unlikely to have a negative impact on:-
the freedom or fairness of elections to any legislature; India's sovereignty and integrity; the state's interests in security, strategy, science, or economics; and the public interest.
a cordial relationship with any foreign country;
harmony among castes, communities, social groups, racial groups, and language or regional groups.
FCRA utilization
Forms FC-3A and FC-3B for registration and prior permission must be filed online together with a cost of INR 10,000 for registration and INR 5,000 for prior permission, respectively.
FCRA Registration is valid for five years and must be renewed in Form FC- 3C no later than six months before the end of the five-year period.
It is mandatory to have an FCRA bank account with SBI's main branch, an Aadhar number, and a DARPAN ID.
FCRA Compliances
Annual returns in Form FC-4, coupled with statements of receipt and payment accounts and balance sheets that have been properly approved by CA, are required for FCRA compliance and must be submitted online by the 31st of December each year.
Even if foreign contributions are not utilized or received, it is still necessary to submit a nil FCRA return in order to comply with the FCRA's requirements. Records and adequate books of account must be kept.
FCRA Compliance is required by nature, and any violation may result in imprisonment, a fine, or both under the terms of the FCRA legislation. From Bank's Perspective Banks must disclose two different types of transactions to the government.
Types of FCRA forms
FC-1(Part D)
The filing due date of this form is within 45 days of being nominated. The purpose of this form is the intimation to the authority. If any candidate for an election received a foreign contribution in the 180 days before being nominated. There is no minimum purchase requirement. (Taking any foreign contributions is forbidden for candidates running for office.)
FC-1 (Part B)
The due date for filing it is 31st Dec in next year end of the year. This form is also for the purpose of intimation. Providing details regarding securities acquired during the year.
This form can also be filed for providing details on AOA received throughout the year.
FC- 1(Part A)
The due date of filing is within 30 days of receipt. This is also for the purpose of intimation to the authority. It is for telling the government that you received significant gifts from family (Who are Foreign Citizens). Everyone must comply with this, including HUFs. The ceiling is INR 1,00,000 in one fiscal year.
(A person must submit this notification for each receipt they receive during the FY after crossing INR 1,00,000)
FC- 2
The due date for filing this form is 14 days in advance. This form is for taking permission from the government. Before accepting foreign hospitality, those in public service should submit form FC-2. A dinner invitation or a lift are exceptions, but there is no lower cut-off.
FC-3 (Part-B)
It normally takes 3 to 6 months for prior permission. The purpose of this form is also to take permission. People should ask for prior permission if they are unable to obtain FCRA registration. Prior approval is required for a particular NGO project and a certain amount of foreign contributions. By way of Foreign Contribution (which may be gotten in installments)
FC- 3(Part-A)
There is no such filing date normally it takes 4 to 6 months to get registered. The purpose of this form is to take permission. People who want to accept foreign contributions on a regular basis should submit a registration application on form FC-3.
(Typically, NGOs with a three-year track record and who have invested at least INR 10 lakh towards the trust's goal)
FC-3(Part C)
The filling due date is ideally 5 to 6 months before expiry. The purpose of this form is to take permission. The FCRA registration is only valid for five years, thus you must submit a renewal application in FC -3 Part C.
FC-5
The due date for filling is before the transfer of any contribution. Its purpose is also to take permission from the government. Any FCRA-registered individual who wants to give a foreign contribution to an unregistered individual.
FC-4
The filing due date of this form is 31st Dec following the end of the year. The purpose of this form is to file the annual return. Within 60 days of the end of the fiscal year, every foreign corporation must complete and submit an eForm FC-4 for its annual return. A yearly report on the amount of foreign currency used, Form FC-6 a contribution was made and used during the financial year. This includes both financial and in-kind contributions. An FCRA-registered individual or someone with prior people with permission.
FC-6
This form should be filed within 15 dates of changes made. It is filled for the purpose of intimation to the government. Annual account of foreign contributions received and used, Form FC-6. For a yearly account of foreign contributions received and used, you can locate Form FC-6. Any FCRA-registered individual who desires to alter the name of an association, a designated bank account, a utilization bank account, or the identities of more than half the key members.
Conclusion
The Foreign Contribution Regulation Act (FCRA), without a doubt, was created with the goal of serving the national interest and any issues connected to it. One may say that the constitutionality of other Acts, such as the Companies Act of 2013 and the Companies Corporate Social Responsibility Policy Rules of 2014, served as the foundation for this Act's interpretation. A matter that is intended to defend economic, social, communal, cultural, educational, and religious values is said to be in the national interest. Any donation delivery or transfer from a foreign source to a source, whether in India or abroad, is referred to as a "foreign contribution."
Get a free Consultation service for FCRA Registration with Our Top-skilled Experts.
Author:
Leave a Comment
Previous Comments