FCRA Rules

Govt Schemes Knowledgist
Foreign Contribution Regulation Act (FCRA)

● The Foreign Contribution (Regulation) Act registration is mandatory for any
NGO orassociation to receive foreign funds or donations.
● The registration of thousands of NGOs was up for renewal in 2020−21. The Home Ministry
haddeclined to renew the FCRA registration of 179 NGOs.
Why It’s in News:
Note:
Section 5 of the Foreign Contribution (Regulation) Act, 2010 gives the Union government
unchecked and unbridled powers= to declare an organisation as being one of political nature
and deny it access to funds from sources abroad. FCRA is implemented by the Ministry of Home
Affairs.
Registered associations can receive foreign contributions for social, educational, religious,
economic and cultural purposes.
Foreign Contribution (Regulation) Amendment Rules, 2022 (FCRA Rules 2022)

Any gift or foreign contribution by an Individual from foreign relatives is required to be
intimated to the Central Government in Form FC-1 within 3 months if the amount exceeds Rs.
10 Lakh in a financial year.
FCRA Registration & Cancellation:
The government reserves the right to cancel the FCRA registration of any NGO if it finds it to
be inviolation of the Act.
● Registration can be cancelled if an inquiry finds a false statement in the application; if the
NGO is found to have violated any of the terms and conditions of the certificate or
renewal; If it has not been engaged in any reasonable activity in its chosen field for the
benefit of societyfor two consecutive years; or if it has become defunct.
● It can also be cancelled if in the opinion of the Central Government, it is necessary in
the public interest to cancel the certificate.
● Registrations are also cancelled when an audit finds irregularities in the finances of an
NGO interms of misutilisation of foreign funds.
● Once granted, FCRA registration is valid for five years. NGOs are expected to apply for
renewal within six months of the date of expiry of registration.
● In case of failure to apply for renewal, the registration is deemed to have expired, and the
NGO is no longer entitled to receive foreign fundsor utilise its existing funds without
permission from the ministry.
What Is A Foreign Contribution Under FCRA?

● Foreign contribution" under FCRA covers any “donation, delivery or transfer made by any
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foreign source of any article" as long as it is not given as a gift for personal use, or if its
marketvalue in India at the time it was made is “not more than such sum as may be
specified from time to time by the Central government".
Exceptions:
● Any currency, or security can fall under the ambit of the Act though it excludes any
money received “by way of fee or towards cost in lieu of goods or services rendered by
such personin the ordinary course of his business, trade or commerce whether within
India or outside India".
● Neither are donations made by Non−Resident Indians (NRIs) considered to be foreign
“contribution" although a donation from a person of Indian origin who has assumed
foreignnationality is treated as as “foreign contribution".
Who Cannot Receive Foreign Contribution?

A host of entities are barred from receiving foreign funds, including election candidates,
those connected with a registered newspaper, judges, government servants or employees of
any entitycontrolled or owned by the government and members of any legislature. Political
parties and their office bearers, too, are prohibited from receiving foreign funds.
1. FCRA Rules 2022 allows Indians to receive up to Rs___ lakh in a year from relatives
staying abroad without informing the authorities. The earlier limit was Rs 1 lakh..
a) 10 lakhs
b) 5 laks
c) 3 laks
d) No limit
2. The time limit to intimate the receipt of a foreign contribution from relatives to the Central
Government in FC-1 is increased to _____ from the existing time limit of 30 days.
a) 45 Days
b) 2 Months
c) 3 Months
d) 180 Days
3. One of the conditions of obtaining the FCRA registration or prior permission is that the
organization making the application must have an :
a) FCRA Bank Account
b) SEBI Approval
c) Pan Card
d) RBI LRN Number
4. FCRA rules say a person may open one or more accounts in one or more banks to utilize the
foreign contribution after it has been received and, in all such cases, intimation in electronic
form in Form FC-6D shall be furnished to the Secretary, Ministry of Home Affairs, New
Delhi within ______ of the opening of any account.
a) 5 Days
b) 15 Days
c) 30 days
d) 45 days
5. The Form that is Submitted by entities for intimation of foreign contribution by way of gift,
as Articles, Securities, or for Election:
a) FC-1
b) FC-6
c) FC-1A
d) FC1-B
6. The Form that is Submitted by entities for intimation of opening of Additional Bank
Account for FC- Utilization:
a) FC-1
b) FC-6A
c) FC-6D
d) FC1-6C
7. The FCRA Act Aims at:

a) Stop Hawala Transactions
b) Regulate Shell companies
c) Prohibition of Foreign Funding that is not in National Interest
d) Restrict Political Funding
Answers:
1.a 2.c 3.a 4.d 5.a 6.c 7.c

FCRA Rules

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FCRA Rules

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Govt Schemes Knowledgist

Foreign Contribution Regulation Act (FCRA)

Why It’s in News:

Foreign Contribution (Regulation) Amendment Rules, 2022 (FCRA Rules 2022)

FCRA Registration & Cancellation:

What Is A Foreign Contribution Under FCRA?

Who Cannot Receive Foreign Contribution?

7. The FCRA Act Aims at:

1.a 2.c 3.a 4.d 5.a 6.c 7.c

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