FCRA Handbook
FCRA Handbook
FCRA Handbook
AccountAble Handbook
FCRA
AccountAidTM India
New Delhi
About this book
(front inside cover)
The AccountAble Handbook is a compilation of
the individual issues of ‘AccountAble’, released
by AccountAid India since 1994. These issues
have been designed and circulated on a monthly
basis primarily for the partners of our client Agen-
cies.
‘AccountAble’ is circulated to about 1,200 per-
sons, including Chartered Accountants. It is also
available through e-mail, on a complimentary
basis. The present compilation brings all issues
of AccountAble related to FCRA together at one
place.
While we have taken utmost care to make sure
there are no mistakes, the handbook is designed
to provide a general understanding only. We,
therefore, suggest that you seek independent
and responsible advice before taking any impor-
tant decisions based on this material.
We trust the handbook will be of use to imple-
menting NGOs in India, grant-making Agencies,
consultants and auditors dealing with FCRA as
also to law-makers.
The law presented in this book is valid as of 30th
June 2002. It applies to India as well as to In-
dian citizens wherever located.
(i)
AccountAble™ Handbook
FCRA
AccountAid™ India
New Delhi
© AccountAid India 2002
All rights reserved.
No part of the publication may be reproduced or transmitted in any form or by any means, without
prior permission of AccountAid India, in writing.
However, AccountAid India encourages reproduction or re-distribution of this material in work-
shops or through non-profit / academic institution newsletters for non-commercial use, provided
the source is acknowledged. Your use must not affect our rights to the material adversely.
The source should be acknowledged as ‘Copyright material of AccountAid™ India. Used for non-
commercial purposes under general permission’.
Price: Rs.75/-
Published by:
AccountAid India,
55-B, Pocket C, Sidharth Extension,
New Delhi – 110 014
Ph.: 011-634 3128, 634 6111
Fax: 011-634 3852
e-mail: accountaid@vsnl.com
The Act was essentially designed to prevent flow of foreign funds to political parties
in India. It was brought in after a big controversy erupted in 1967 over the possible use
of foreign funds in parliamentary elections. By 2002, there were similar laws operating
in many countries across the world, including USA, UK, France, Japan, Germany,
Canada, Russia, Malaysia, and Spain.
In 1984, the law was amended to regulate flow of funds to charitable organisations
more closely, based on the Government’s perception that some of these organisations
may be used to channelise funds to political parties. This has resulted in a lot of
paper-work and confusion for non-profits working in India. Reflecting this confusion,
one of our first issues on FCRA was titled ‘Mysteries of FCRA’!
With time, the mysteries have reduced somewhat. The FCRA Department has also
adapted a citizen’s charter and has tried to streamline its working. However, much
remains to be done.
One peculiar implication of the 1984 amendment has been that FCRA is now commonly
perceived as a law focusing on the NGOs. While this was not the intention of the law,
this is what may actually have happened, given the fact that most of the time FCRA
Department is dealing with NGOs (nearly 25,000 associations have FCRA registration).
The present handbook is designed primarily for use by NGOs, who often find themselves
on the receiving end, so far as FCRA is concerned (no pun intended). Similarly,
consultants and auditors, who have to advise NGOs on FCRA, would also find the
book useful. Some sections would be of interest to grant-making Agencies working in
India, who sometimes find that their programs and projects fall foul of FCRA provisions.
Many Agencies located abroad are not aware that such a law exists, and, therefore,
sometimes find it difficult to understand why their projects are delayed. This handbook
may help give them an overview.
While we have tried to make sure that the book is free from errors, still the possibility
remains. We, therefore, welcome your comments and suggestions so that we can
correct these in future editions. A copy of this book is also being put up on our web-
site (www.AccountAid.net), where the information will be updated regularly.
For a compilation like this, acknowledging support can be a bewildering task. So many
people have contributed to this, that it is difficult to decide who can be left out, given
the constraints of space and reader’s attention span. In keeping with our own tradition,
we can mention no individual names.
(i)
However, the most important contribution has come from NGO functionaries and
accountants across India, who have shared their problems with us in confidence.
Many people working in grant-making Agencies, have helped us add depth and insight
to AccountAble, by attending our annual workshops and discussing their concerns.
Then there are people who have encouraged us by visiting our web-site and sending
us their feedback and questions.
We would also like to thank our client Agencies, CRY and Ford Foundation, who have
supported research and publication of AccountAble through these years. The publication
of this handbook has been made possible under an agreement with Ford Foundation
in India, whose people deserve a special word of thanks for their support,
encouragement and the confidence they have shown in us.
We would also like to thank people at Chanakya Mudrak, who worked on this patiently,
despite short notice and a difficult manuscript.
And finally, a special note of thanks to the members of our own team and to their
families, who sacrificed many evenings and weekends to this book.
( ii )
Topics at a Glance
Preface ................................................................................................... i
Detailed Contents ............................................................................. v-xix
( iii )
( iv )
Detailed Contents
Preface ............................................................................................................. i
Topics at a Glance .............................................................................................. iii
(v)
Maharashtra ............................................................................................................ 13
Manipur ................................................................................................................... 14
Meghalaya .............................................................................................................. 14
Mizoram ................................................................................................................. 14
Nagaland ................................................................................................................ 14
Orissa .................................................................................................................... 14
Pondicherry (UT) ..................................................................................................... 15
Punjab .................................................................................................................... 15
Rajasthan ............................................................................................................... 15
Sikkim .................................................................................................................... 15
Tamil Nadu .............................................................................................................. 16
Tripura .................................................................................................................... 16
Uttar Pradesh ......................................................................................................... 16
West Bengal ........................................................................................................... 16
State-wise distribution of FC funds: Basic data ................................................ 17
Non-Foreign Sources ................................................................................ 19
Notified by the Government .............................................................................. 19
Other non-foreign sources ............................................................................... 23
Foreign Sources ........................................................................................ 25
Profiles of Top FC Donors ......................................................................... 31
The problem of double counting ....................................................................... 31
1. Foster Parents Plan International ................................................................. 31
2. EZE .......................................................................................................... 32
3. Christian Children’s Fund.............................................................................. 32
4. Missio .......................................................................................................... 33
5. ACTIONAID ................................................................................................. 33
6. Maharishi Ayurved Trust .............................................................................. 33
7. Kinder Not Hilfe ............................................................................................. 34
8. World Vision International.............................................................................. 34
9. MISEREOR .................................................................................................. 34
10. Manos Unidas Committee .......................................................................... 35
11. Ford Foundation .......................................................................................... 35
12. Inter Church Coordination Committee ........................................................ 36
13. Oxfam (India) Trust ..................................................................................... 36
14. Christian Aid ............................................................................................... 37
( vi )
15. Age of Enlightenment Trust ......................................................................... 37
16. IPPF .......................................................................................................... 37
17. Foundation Vincent Ferrer .......................................................................... 38
18. Bilance ........................................................................................................ 38
19. USAID ........................................................................................................ 38
20. Christoffel Blinden Mission ......................................................................... 38
21. Gospel for Asia ........................................................................................... 39
22. Opere Don Bosco ....................................................................................... 39
23. Missio Prokur.............................................................................................. 39
24. The Leprosy Mission .................................................................................. 39
25. Bread for the World ..................................................................................... 40
26. Plan International ........................................................................................ 40
27. Children House International ...................................................................... 40
28. Manos Unidas Afonso TED ........................................................................ 41
29. Lutheran World Federation .......................................................................... 41
30. Maharishi Education Foundation................................................................. 41
31. Mata Amritanandmayi Centre ..................................................................... 41
32. HIVOS Foundation ...................................................................................... 42
33. The Save the Children Fund ....................................................................... 42
34. General Conf. of 7th day Adventists ........................................................... 42
35. SOS Kinderdorf International ...................................................................... 43
36. ZEH .......................................................................................................... 43
37. Zentralstelle Fur Entwickshilfe .................................................................... 43
38. Soka Gakkai International .......................................................................... 43
39. Bergita PIR ................................................................................................. 43
Profiles of Top FC Receivers .................................................................... 44
1. Maharishi Ved Vigyan…(MVVVV) ................................................................. 44
2. Foster Parents Plan International ................................................................. 45
3. Sri Sathya Sai Central Trust .......................................................................... 45
4. World Vision of India ..................................................................................... 45
5. Mata Amritanandmayi Mission ...................................................................... 46
6. Actionaid ....................................................................................................... 46
7. CSI Council for Child Care ........................................................................... 46
8. SOS Children’s Village of India ..................................................................... 47
( vii )
9. CASA .......................................................................................................... 47
10. Tibetan Children’s Village ............................................................................ 47
11. Oxfam (India) Trust ..................................................................................... 48
12. Missionaries of Charity ............................................................................... 48
13. Seventh Day Adventists .............................................................................. 48
14. Rural Development Trust ............................................................................ 48
15. Caritas India ............................................................................................... 49
16. IGSSS ......................................................................................................... 49
17. Gospel for Asia ........................................................................................... 49
18. SIFPSA ....................................................................................................... 49
19. MYRADA ..................................................................................................... 49
20. FPAI .......................................................................................................... 50
21. Lilavati Kirtilal Mehta Medical Trust ............................................................. 50
22. SRM Foundation of India ............................................................................. 50
23. Leprosy Mission Trust of India .................................................................... 50
24. India Campus Crusade for Christ ............................................................... 51
25. Christian Children’s Fund ........................................................................... 51
26. BAPS .......................................................................................................... 51
27. Central Tibet Relief Committee .................................................................. 52
28. Lutheran World Service - India ................................................................... 52
29. AMG India International ............................................................................... 52
30. Maharishi Gandharvaved Vishwa Vidyapeetham (MGVV) ........................... 52
31. Community Aid Sponsorship Program ....................................................... 53
32. Bharat Soka Gakkai .................................................................................... 53
33. The Assemblies of God Church ................................................................. 53
34. Watchtower Bible Tract Society of India ..................................................... 53
35. ASSEFA ...................................................................................................... 54
36. Holistic Child Development of India ............................................................ 54
37. Indian Society of Church of Jesus Christ ................................................... 54
38. Aga Khan Foundation ................................................................................. 54
( viii )
Procedure ......................................................................................................... 57
Apply in FC-1A ....................................................................................................... 57
Field Inquiry ............................................................................................................ 57
Reply from FCRA .................................................................................................... 57
Appeal against rejection .......................................................................................... 57
Common doubts............................................................................................... 57
More than once ....................................................................................................... 57
Tailor-made ............................................................................................................. 57
Joint grants ............................................................................................................. 58
Maximum Amount .................................................................................................. 58
How early ................................................................................................................ 58
Advance Credit ........................................................................................................ 58
Automatic permission? ........................................................................................... 58
Filing FC-3 .............................................................................................................. 58
Filling up FC-1A ................................................................................................ 58
1. Background ........................................................................................................ 58
2. Convictions ......................................................................................................... 59
3. Branch or Associate ........................................................................................... 59
4. FCRA Registration .............................................................................................. 59
5. Prior-permission .................................................................................................. 59
6. Newspapers ........................................................................................................ 60
7. Activities and Accounts ...................................................................................... 60
8 (i). How much ...................................................................................................... 60
8 (ii). Project Proposal and Budget .......................................................................... 60
9. Bank Account ..................................................................................................... 60
10. Details of foreign source .................................................................................... 60
10A. Recommendation Certificate ........................................................................... 61
11. Additional Information ........................................................................................ 61
Signing ................................................................................................................... 61
Check-list of Documents to be attached .......................................................... 61
Copies .................................................................................................................... 61
Send it to FCRA ..................................................................................................... 62
( ix )
Filing FC-8 .............................................................................................................. 63
Scrutiny .................................................................................................................. 63
Field Enquiry and Report ......................................................................................... 63
Acceptance ............................................................................................................ 63
Registration Certificate ............................................................................................ 63
Rejection ................................................................................................................ 64
Grounds for rejection ............................................................................................... 64
How long will all this take? ...................................................................................... 64
Appeal .................................................................................................................... 64
Can the courts help? ............................................................................................... 64
Common Problems .......................................................................................... 64
Only registered NGOs ............................................................................................. 64
Three years ............................................................................................................. 65
No foreigners ........................................................................................................... 65
No time frame ......................................................................................................... 65
Reason for refusal? ................................................................................................. 65
Filling up FC-8 .................................................................................................. 65
1. Background ........................................................................................................ 65
2. Convictions ......................................................................................................... 66
3. Branch or Associate ........................................................................................... 66
4. Prior-permission .................................................................................................. 66
5. Newspapers ........................................................................................................ 66
6. Earlier applications ............................................................................................. 67
7. Activities and Area .............................................................................................. 67
8. Politics ............................................................................................................... 67
9. Bank Account ..................................................................................................... 67
9A. Recommendation Certificate ............................................................................. 67
10. Additional Information ........................................................................................ 68
Undertaking ...................................................................................................... 68
Sign and Date ......................................................................................................... 68
Sending the form ..................................................................................................... 68
Check-list of Documents to be attached .......................................................... 69
Basics of FC-3 .......................................................................................... 70
What is FC-3 .......................................................................................................... 70
Who should file FC-3 .............................................................................................. 70
Due Date ................................................................................................................ 70
(x)
File it Each Year ..................................................................................................... 70
FC-3 Form revised (July 2001) ................................................................................. 70
Filling the Form ................................................................................................. 70
Year .......................................................................................................... 70
Heading 1: Association’s Details ................................................................. 70
Item (i): Name and Address ............................................................................... 70
Item (ii): FCRA Registration ............................................................................... 71
Item (iii): Prior Permission ................................................................................. 71
Item (iv): Nature of Association .......................................................................... 71
Item (v): Religious .............................................................................................. 71
Heading 1A: Interest, etc. ............................................................................ 71
Item (i): Foreign contribution .............................................................................. 71
Item (ii)(a): Interest on FCRA bank account ....................................................... 71
Item (ii)(b): Other interest .................................................................................. 71
Heading 2: Purpose-wise Receipt and Utilisation ........................................ 71
Column 2: Purpose............................................................................................ 72
Classifying your expenses ........................................................................... 72
Columns 3, 4: Previous Balance ........................................................................ 72
Columns 5 to 9: Receipts .................................................................................. 72
First Recipient ............................................................................................. 72
Second Recipient ........................................................................................ 72
Columns 5 and 7: Receipts in Cash ............................................................. 72
Columns 6 and 8: Receipts in Kind .............................................................. 72
Column 9: Total Receipts ............................................................................. 72
Columns 10 and 11: Amount Utilised ................................................................. 73
Columns 12 and 13: Balance............................................................................. 73
Add Up the Columns ......................................................................................... 73
Heading 3: Bank Details .............................................................................. 73
Heading 4: Donor Details ............................................................................ 73
(i) Institutional Donors ....................................................................................... 73
Second Recipient ........................................................................................ 73
(ii) Large Individual Donors ................................................................................. 74
(iii) Small Individual Donors ................................................................................ 74
Heading 5: Country-wise Receipts .............................................................. 74
Declaration .................................................................................................. 74
CA Certificate .............................................................................................. 74
( xi )
FC-3 Annexures .......................................................................................... 74
Intricacies of FC-3 ...................................................................................... 75
Opening Items .................................................................................................. 75
Address .................................................................................................................. 75
FCRA registration cancelled ................................................................................... 75
Summary of Interest ................................................................................................ 75
Table 2: Receipt and Utilisation ......................................................................... 75
FCRA Loans ........................................................................................................... 75
Receipts in Kind ..................................................................................................... 75
Valuation ................................................................................................................. 76
FC-6 .......................................................................................................... 76
Materials not reported... .................................................................................... 76
Who should report? ........................................................................................... 76
Micro-credit / Revolving Fund .................................................................................. 76
‘56: Other Activities’ ................................................................................................ 76
Interest ................................................................................................................... 76
Bank Interest ..................................................................................................... 76
Revolving Fund Interest ...................................................................................... 77
Corpus Interest .................................................................................................. 77
Second Recipient .................................................................................................... 77
Non-earmarked Donations ....................................................................................... 77
Sale of Assets ........................................................................................................ 77
Transfers to Other NGOs ........................................................................................ 77
Level of Detail ......................................................................................................... 77
Unutilised balances .......................................................................................... 78
In Cash ................................................................................................................... 78
In Kind .................................................................................................................... 78
Loan transactions with Indian Section .............................................................. 78
For opening bank account ....................................................................................... 78
During the year ....................................................................................................... 78
Bank Details ..................................................................................................... 79
Table 4: Donor Details ...................................................................................... 79
Box Collections ...................................................................................................... 79
Small Individual Donors ........................................................................................... 79
More on Individual Donors ....................................................................................... 80
Table 5: Country Chart ...................................................................................... 80
( xii )
Country-wise Receipts ............................................................................................ 80
Donation Box Collections .................................................................................. 80
From Another Indian Agency ............................................................................. 80
Reconciliation ................................................................................................... 80
Tables 2 and 4 ........................................................................................................ 80
Table 2: Cross-check Unutilised Balance in Cash ................................................... 80
Table 2: Cross-check Balance in Kind ..................................................................... 81
Closing Items ................................................................................................... 81
Signing FCRA Accounts .......................................................................................... 81
1. Balance Sheet .............................................................................................. 81
2. Receipts and Payments ................................................................................ 81
CA Certificate .................................................................................................... 81
Accounting Standards ............................................................................................. 81
Proof of posting ....................................................................................................... 82
Copy to Donors ....................................................................................................... 82
Filing Nil FC-3 ......................................................................................................... 82
Penalty for not filing FC-3 ........................................................................................ 82
Concealing Information ............................................................................................ 83
Revising your FC-3 .................................................................................................. 83
( xiii )
3. Mode ............................................................................................................. 85
4. Purpose ........................................................................................................ 85
5. Quantity ........................................................................................................ 86
6. Approximate Value ........................................................................................ 86
7. Intimation ...................................................................................................... 86
Utilisation ................................................................................................................ 86
8. Date .............................................................................................................. 86
9. Beneficiary .................................................................................................... 87
10. Purpose ...................................................................................................... 87
11. Utilised by NGO .......................................................................................... 87
12. Sold off ........................................................................................................ 87
13. Transferred .................................................................................................. 87
14. Sale recovery .............................................................................................. 87
15. Entry reference ............................................................................................ 87
16. Closing Balance .......................................................................................... 87
Declaration and Signature ................................................................................ 88
Open a new account each year ....................................................................... 88
Auditing FC-6 .................................................................................................... 88
FCRA Fellowships ..................................................................................... 89
Key features of a fellowship .............................................................................. 89
Valuing the Fellowship ...................................................................................... 89
Splitting Hairs ......................................................................................................... 90
FCRA: Issues and Formalities ......................................................................... 90
Routed fellowships .................................................................................................. 90
No permission or registration .................................................................................. 90
Prohibited ............................................................................................................... 90
Journalists .............................................................................................................. 91
Accounts and Income Tax ....................................................................................... 91
File Form FC-5 ........................................................................................................ 91
Who should file FC-5 .............................................................................................. 91
Filling up FC-5 ........................................................................................................ 91
When and Where .................................................................................................... 92
( xiv )
Section III: Intricacies ................................................................. 99
Understanding FCRA ............................................................................... 101
Foreign Source ............................................................................................... 101
1. Individuals ......................................................................................................... 101
a. Non-resident Indians (NRIs) ......................................................................... 101
b. Persons of Indian Origin (PIOs) ................................................................... 101
c. Dual Citizenship .......................................................................................... 102
2. Government ...................................................................................................... 102
3. International Agencies ....................................................................................... 102
4. Non-profit organisations .................................................................................... 102
a. Trusts .......................................................................................................... 103
b. Foundations ................................................................................................ 103
c. Society, clubs, etc. ..................................................................................... 103
d. Corporations ................................................................................................ 103
e. Trade Unions ............................................................................................... 103
5. Business Organisations .................................................................................... 104
a. Company .................................................................................................... 104
b. Subsidiary ................................................................................................... 104
c. Corporation .................................................................................................. 104
d. Multi-national Corporation (MNC) ................................................................. 104
Permitted institutions ............................................................................................ 104
FC Receivers ................................................................................................. 105
1. Political parties ................................................................................................. 105
2. Organisations of a political nature ..................................................................... 105
3. Individuals in public life ...................................................................................... 105
4. NGOs ............................................................................................................... 105
5. Private individuals .............................................................................................. 106
6. Business organisations ..................................................................................... 106
Business Transactions ................................................................................... 106
Organizations of a political nature .................................................................. 106
Mysteries of FCRA ................................................................................... 111
1. Prior permission ..........................................................................................111
2. FCRA Number .............................................................................................111
3. Change of Bank Account .............................................................................111
4. More than one bank account ...................................................................... 112
( xv )
5. Interest on FCRA Funds ............................................................................. 112
6. Revolving Fund ........................................................................................... 112
7. Income from FCRA IGP.............................................................................. 112
8. Sale of fixed assets .................................................................................... 112
9. Separate Cash Book and Ledger ............................................................... 113
10. Consolidated Balance Sheet .................................................................... 113
11. Disclosing non-cash grants in form FC-3 ................................................. 113
12. Don’t File form FC-6 ................................................................................. 113
13. Second or subsequent recipient ............................................................... 113
14. Revising form FC-3 .................................................................................. 113
15. Fellows: file form FC-5 ............................................................................. 113
16. Shadow lending ........................................................................................ 113
17. Funds to non-FCRA NGOs ...................................................................... 114
18. Governing Body ........................................................................................ 114
19. Funding Agencies ..................................................................................... 114
20. Form FC-3 in duplicate ............................................................................. 114
21. Elections ................................................................................................... 114
Puzzles of FCRA ...................................................................................... 115
1. FCRA grants to individuals ......................................................................... 115
2. Business people/ professionals ................................................................. 115
3. Electronic media ......................................................................................... 115
4. Change of bank account number ............................................................... 115
5. Advances from FC funds ............................................................................ 116
6. Loan between FC and Indian ...................................................................... 116
7. Mahila Mandals ........................................................................................... 116
8. Indian office of foreign Agency .................................................................... 117
9. Opening branch abroad .............................................................................. 117
10. Organisations of a political nature ............................................................ 117
11. Churches and Ashrams ............................................................................ 117
12. Does second receiver need FCRA ........................................................... 117
13. When do FC funds become Indian ........................................................... 117
14. Catalogue sponsorship ............................................................................. 118
15. Souvenir Advertisements .......................................................................... 118
16. Relatives ................................................................................................... 118
( xvi )
17. Unrestricted FC funds .............................................................................. 118
18. Unrestricted FC funds – under Prior Permission ..................................... 119
19. FEMA and FCRA ...................................................................................... 119
Fund-raising and FCRA ........................................................................... 120
1. Anonymous donations ................................................................................ 120
2. NRI donations ............................................................................................. 120
3. Charity events............................................................................................. 120
4. Raising funds abroad ................................................................................. 121
5. Consultancy income of NGO ...................................................................... 121
6. Sale of Publications .................................................................................... 121
7. Staff Recoveries ......................................................................................... 121
8. Hire Charges .............................................................................................. 122
9. Guest recoveries ........................................................................................ 122
10. Recoveries from Beneficiaries ................................................................. 122
11. Endowment Funds ................................................................................... 122
12. Endowment Investments .......................................................................... 122
13. Endowment Income ................................................................................. 122
14. How much ................................................................................................ 122
15. Exchange rate variations .......................................................................... 123
16. Unused prior-permission .......................................................................... 123
17. Foreign Volunteers .................................................................................... 123
18. Items less than thousand rupees ............................................................. 123
19. Old items in FC-6 and FC-3 ..................................................................... 123
20. PL-480 ...................................................................................................... 123
21. Bilateral funds ........................................................................................... 123
( xvii )
The Foreign Contribution (Regulation) Act, 1976 ....................................... 156
Section 1. Short title, extent, application and commencement ................................... 156
Section 2. Definitions– ................................................................................................ 156
Section 3. Application of other laws not barred .......................................................... 158
Section 4. Candidate for election, etc. not to accept foreign contribution– ................. 159
Section 5. Organisation of a Political nature not to accept foreign contribution
except with the prior permission of the Central Government .................................. 160
Section 6. Certain associations and persons receiving foreign contribution to give
intimation to the Central Government– .................................................................. 160
Section 7. Recipients of scholarships, etc. to give intimation to the Central Govt. ...... 161
Section 8. Persons to whom Section 4 shall not apply– ............................................ 161
Section 9. Restrictions on acceptance of foreign hospitality– .................................... 162
Section 10. Power of Central Government to prohibit receipt of foreign contribution,
etc. in certain cases ............................................................................................. 162
Section 11. Application to be made in prescribed form for obtaining prior
permission to accept foreign contribution or hospitality– ....................................... 163
Section 12. Power to prohibit payment of currency received in contravention
of the Act– ............................................................................................................ 163
Section 13. Recipients of foreign contribution to maintain accounts, etc.– ................. 163
Section 14. Inspection of accounts or records– ......................................................... 164
Section 15. Seizure of accounts or records ............................................................... 164
Section 15 A. Audit of accounts– ............................................................................... 164
Section 16. Seizure of article or currency received received in contravention
of the Act ............................................................................................................. 164
Section 17. Seizure to be made in accordance with the Code of Criminal
Procedure, 1973– .................................................................................................. 165
Section 18. Confiscation of article or currency obtained in contravention
of the Act .............................................................................................................. 165
Section 19. Adjudication of confiscation– .................................................................. 165
Section 20. Opportunity to be given before adjudication of confiscation– .................... 165
Section 21. Appeal– .................................................................................................. 165
Section 22. Penalty for article or currency obtained in contravention of Sec. 12 ......... 166
Section 23. Punishment for the contravention of any provision of the Act ................... 166
Section 24. Power to impose additional fine where article or currency is not
available for confiscation– ..................................................................................... 166
Section 25. Penalty for offences where no separate punishment has been
provided ................................................................................................................ 166
Section 25-A. Prohibition of acceptance of foreign contribution– ................................. 166
Section 26. Offences by companies– ........................................................................ 166
( xviii )
Section 27. Bar to the prosecution of offences under the Act– ................................... 167
Section 28. Investigation into cases under the Act– ................................................... 167
Section 29. Protection of action taken in good faith– ................................................. 167
Section 30. Power to make rules– ............................................................................. 167
Section 31. Power to exempt– ................................................................................... 168
Section 32. Act not to apply to Government transactions– ........................................ 168
( xix )
Section I: Funds, Sources & Receivers
Before we go into the technicalities of FCRA, we try to get an overview of the money involved:
how much money is received each year, who gives this money, who receives, and what is it
used for.
The data given in this section is mostly based on reliable sources (except the narratives in the
profiles). However, please keep in mind that this is not all the foreign aid that flows into India
– aid received and redistributed by the Government is not included here. Similarly, aid received
by NGOs from UN Organisations or the World Bank is not included in these figures.
This section includes the following chapters:
1
2
Inflow of Foreign Contribution1
Present status
By November 2001, a total of 24,204
associations were registered with
FCRA. Apart from these, about 1,500
associations had prior-permission.
Together, this comes to about 26,000
associations.
How many filed their FC-3
How many file FC-3
13,986
13,775
12,136
12,198
Not all. Only about 60-70% file FC-3 regularly. 11,422
10,963
10,950
10,201
92-93
94-95
95-96
93-94
96-97
97-98
98-99
99-00
What about the rest
The law requires that FC-3 must be filed3
even if no foreign contribution is received in a year. However, the balance 30-40% seems to be
quite consistent in not filing their FC-3 in time!
FCRA Department then issues them a notice. If they ignore the notice, this leads to cancellation
of FC registration. In the past, Government has cancelled FC registration of 203 organizations
in July-96 and another 497 in September 1997.
Foreign contribution has gone up from Rs.1,412 crores in 91-924 to Rs.3,925 crores in 99-00.
1
Based on AccountAble 63: Inflow of FC: 98-99/ 99-00
2
April through March
3
By an FCRA registered association
4
15 months: Jan ’91 to Mar ’92
3
That means an annual growth rate of 13.63% over these nine years. The rate has been lowered
somewhat due to stagnation in 94-95.
91-92
95-96
96-97
97-98
94-95
92-93
93-94
98-99
99-00
purchasing power.
Thirdly, program activities have also probably increased over the years.
Another perspective…
The table probably looks exciting
to mathematicians. For simple
human beings, it is not of much
use. The chart here shows a
simpler picture, with fewer
categories. This is a percentage
chart and does not give money
figures. Rather it shows the relative
percentage under a category in
each year.
4
Purpose of Receipt Amount in Crores
96-97 97-98 98-99 99-00
1. Health Care & Family Welfare 284.6 306.4 407.9 449.4
2. Sanitation 2.1 4.4 **** ****
3. Welfare of Women & Children **** **** 56.3 99.9
4. Help for Poor, Aged & Destitute 171.4 210.1 272.0 230.1
5. Care of Orphans 210.8 191.3 172.9 286.2
6. Construction/ Extension of School/ College Building 97.3 290.0 145.2 184.6
7. Repair/ Maintenance of School/ College Building 70.2 49.9 36.4 31.5
8. Construction/ Extension of other Building 143.0 115.4 185.2 255.8
9. Repair/ Maintenance of other Building 41.5 27.0 74.4 42.2
10. Housing 10.8 16.0 **** ****
11. Research 138.8 125.9 66.0 74.0
12. Stipends/ Scholarship 47.1 56.7 42.7 63.4
13. Vocational/ Technical Training **** **** 40.6 48.5
14. Education/ Literacy Programs **** **** 126.1 156.2
15. Seminars/ Conference/ Meetings **** **** 20.0 27.0
16. Construction/ Extension of places of Worship 41.9 39.9 91.1 99.5
17. Repairs/ Maintenance of places of Worship 69.2 40.9 31.7 24.6
18. Education of Priest & Preachers 53.7 47.7 60.6 76.1
19. Religious Functions 74.7 46.6 57.4 58.6
20. Publication of Religious Literature 20.2 11.4 23.5 24.6
21. Agricultural Activities 17.5 31.7 20.6 26.3
22. Animal Husbandry 9.0 5.1 5.0 8.6
23. Environmental Programs 3.5 7.7 16.9 18.9
24. Rural Development 274.2 279.9 380.3 522.9
25. Cultural Programs 4.2 3.6 **** ****
26. Theatre/ Films, etc. 11.7 3.6 6.9 5.5
27. Maint. of Places of Historical & Cultural Importance 0.1 0.6 1.5 4.7
28. Relief for Natural Calamities 25.1 36.8 49.2 163.3
29. Establishment Expenses **** **** 163.1 155.4
30. Welfare of other backward classes **** **** 2.5 2.4
31. Welfare of the Scheduled Tribes **** **** 9.5 10.2
32. Welfare of the Scheduled Castes **** **** 1.1 1.9
33. Other Activities 749.1 915.9 836.3 772.3
Total 2571.7 2864.5 3402.9 3924.6
**** Change in FC-3 classification. Therefore, data not reported under this category.
5
What do the table and the chart tell us?
" Money for purely religious activities remains more or less the same, around 10%. Of course,
contrary to popular belief, this money is not for Christian missionaries alone. Money comes
in for other religions also, including Hinduism.
" Welfare type activities5 continue to be important, taking up as much 25% of the total flow.
" Very little money has been reported for environment – rising from a mere Rs.3.54 crores
(0.14%) in 96-97 to 18.9 crores (0.48%) in 99-00. This is contrary to the reality in the field.
Numerous NGOs have spent large sums on environmental programs such as watershed
development, soil and water conservation, forestry, pollution, and other similar issues.
" Similarly, the amount for disaster relief has been low over this period. A total of Rs.111.07
crores was received from 96-97 to 98-99. These were also years when there was no major
earthquake or cyclone. Tragically, these figures jumped to 163.33 crores in 99-00, with the
Orissa cyclone in Oct-99.
" Though India is a land of history, very little is received by NGOs for maintenance of historical
and cultural places. From 96-97 to 99-00, this came to just Rs.6.95 crores! Partly, this is due
to the sprawling presence of ASI6 . Then again, this work is probably low priority for most
international agencies except UNESCO. And UNESCO funds will not be reported under
FCRA.
5
This includes money spent on health education also.
6
Archaeological Survey of India. Foreign funds received by ASI will not be reported under FCRA.
7
Rajya Sabha unstarred question no. 1231 for 7-Mar-01
6
How many received a crore and 43
above… 35 37
>10 crores 60
With the continuing erosion of Rupee, a 69 50
5-10 crores
crore8 today is not what it used to be. 28
1-5 crores
In 91-92, just 249 associations received
24 31
over a crore. By 99-00, this had risen to
684 associations. 19 20 23
581
15 27
536
540
19
And the top 5 were… 13 21
430
If you add up 17
the funds
received over
last nine
years 9 , who
received the
most? The
report names
Maharishi Ved Vigyan Vishwa Vidyapeetham.
Country of Origin…
Where does all this money come from? The MHA reports for last four years (1996-97 to 1999-
00) list about 178 countries, ranging from USA (Rs.1,086.32 crores) to Macau, Laos, Sudan
(Rs.1,000 each!). Then there are smaller donors who are not listed individually – this adds up
to around Rs.57, 52, 37 and 29 crores in 96-97, 97-98, 98-99, and 99-00 respectively.
The following table summarizes contribution of top sixteen donor countries who have contributed
at least Rs.100 crores over last four years (1996-97 to 1999-00):
8
10 million
9
From 91-92 to 99-00
10
Church of South India
7
Amount in Rupees Crores Annual
Country Growth
96-97 97-98 98-99 99-00 Total rate in %
Flow of funds from Spain, UK and USA is rising faster than other countries. For example, fund
from Spain have grown annually at a compounded rate of 35%. In the case of UK, the rate
of growth is 30%. Growth rate in the case of USA is also higher than the rest at 23% per year.
8
State-wise Distribution of Foreign Contribution11
This analysis provides information on how the foreign contribution is distributed across the
country – which areas receive more funds, which do not. It is hoped that this will provide useful
data for people working with NGOs and Agencies.
1.57
97 to 99-00 Tamilnadu
0%
Correlating the state-wise
0.91
more about how FCRA registered NGOs and funds are spread across the country. Remember,
however, that some of the averages related to funds may be distorted due to inclusion of grant-
making Agencies in the FC data. Some NGOs may be working in multiple states, though
headquartered in a particular state. Also simple 96-97
averages
97-98like these
98-99 are not really suitable for
99-00
11
Based on AccountAble 64, 65: Profiles of Top FC Receivers
9
area under each organisation (in sq. k.m.) was 1,178 (an area approx. 34 kms. wide and 34.5
kms. long).
Andhra Pradesh
Andhra
536.99
487.29
" Received Rs.352.72 crores, 398.08 crores, 487.29 crores and 536.99
398.08
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 15.04%
352.72
" Population (2001) 757.28 lakhs " Land area (Sq. K.M.) 275,068
Arunachal Pradesh
Arunachal
" Received Rs.0.28 crores, 0.51 crores and 0.64 crores in 97-98, 98-
0.64
99, 99-00 " Annual growth rate: 51.19% " Population (2001) 10.91
0.51
96-97 97-98 98-99 99-00 area under each organisation (in sq. k.m.) was 14,124 (an area
approx. 118 kms. wide and 119 kms. long).
Assam
" Received Rs.14.88 crores, 17.32 crores, 22.98 crores and 24.35 Assam
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 17.84 %
24.35
22.98
" Population (2001) 266.38 lakhs " Land area (Sq. K.M.) 78,438
17.32
14.88
Bihar
" Received Rs.84.02 crores, 83.24 crores, 100.6 crores and 104.75
Bihar
104.75
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 7.62 %
100.6
" Population (2001) 1,097.88 lakhs (incl. Jharkhand) " Land area (Sq.
83.24
84.02
K.M.) 173,877
10
Chandigrah (UT)
Chandigarh
" Received Rs.1.87 crores, 1.4 crores, 2.28 crores and 2.62 crores in 96-
2.62
97, 97-98, 98-99, 99-00 " Annual growth rate: 11.9 % " Population
2.28
(2001) 9.01 lakhs " Land area (Sq. K.M.) 114
1.87
1.4
17 organisations received Rs.2.62 crores in 99-00, or an average of
Rs.15.39 lakhs each. Average funds per person came to Rs.29.03.
Average population per organisation was 52,995 people. Average
area under each organisation (in sq. k.m.) was 7 (an area approx.
96-97 97-98 98-99 99-00
2 kms. wide and 3.5 kms. long).
0.71
Dadra & Nagar Haveli is classified as a predominantly tribal Union Territory in the report.
No foreign contribution was reported by 3 organisations from Daman and Diu Islands.
418.52
346.35
Delhi
" Received Rs.346.35 crores, 418.52 crores, 487.28 crores and 636.11
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 22.46 %
" Population (2001) 137.83 lakhs " Land area (Sq. K.M.) 1,483
96-97 97-98 98-99 99-00
735 organisations received Rs.636.11 crores in 99-00, or an average
of Rs.86.55 lakhs each. Average funds per person came to
Rs.461.52. Average population per organisation was 18,752 people.
Average area under each organisation (in sq. k.m.) was 2 (an
area approx. 1 km. wide and 2 kms. long).
Goa
" Received Rs.13.28 crores, 12.93 crores, 13.29 crores and 13.81 crores
Goa
13.81
in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 1.3 % " Population
(2001) 13.44 lakhs " Land area (Sq. K.M.) 3,702
13.29
13.28
12.93
11
Gujarat
" Received Rs.80.25 crores, 71.96 crores, 102.09 crores and 126.95 Gujarat
126.95
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 16.52 %
102.09
" Population (2001) 505.97 lakhs " Land area (Sq. K.M.) 196,024
71.96
80.25
551 organisations received Rs.126.95 crores in 99-00, or an average
of Rs.23.04 lakhs each. Average funds per person came to
Rs.25.09. Average population per organisation was 91,828 people.
Average area under each organisation (in sq. k.m.) was 356 (an
96-97 97-98 98-99 99-00
area approx. 18 kms. wide and 20 kms. long).
Haryana
" Received Rs.6.71 crores, 5.93 crores, 5.38 crores and 6.70 crores in
Haryana
96-97, 97-98, 98-99, 99-00 " Annual growth rate: – 0.05 % " Population
6.71
6.7
5.38
Himachal Pradesh
" Received Rs.40.16 crores, 44.50 crores, 64.32 crores and 68.20 crores
Himachal
in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 19.31 % " Population
64.32
68.2
(2001) 60.77 lakhs " Land area (Sq. K.M.) 55,673
44.5
40.16
" Population (2001) 100.7 lakhs " Land area (Sq. K.M.) 101,387
9.93
12
Karnataka
Karnataka
411.34
" Received Rs.274.16 crores, 315.88 crores, 354.73 crores and 411.34
354.73
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 14.48 %
315.88
274.16
" Population (2001) 527.34 lakhs " Land area (Sq. K.M.) 191,791
Kerala
Kerala
361.7
"
322.42
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 14.29 %
242.3
" Population (2001) 318.39 lakhs " Land area (Sq. K.M.) 38,863
Lakshadweep (UT)
" Population (2001) 0.61 lakhs " Land area (Sq. K.M.) 32
Madhya Pradesh
M. P.
" Received Rs.57.81 crores, 60.35 crores, 80.67 crores and 84.57
84.57
80.67
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 13.52 %
60.35
57.81
" Population (2001) 811.81 lakhs (incl. Chhattisgarh) " Land area
(Sq. K.M.) 443,446
Maharashtra
" Received Rs.274.91 crores, 323.52 crores, 322.61 crores and 350.23
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 8.41 %
" Population (2001) 967.52 lakhs " Land area (Sq. K.M.) 307,713
13
Manipur
" Received Rs.10.18 crores, 8.74 crores, 11.73 crores and 9.93 crores in Manipur
96-97, 97-98, 98-99, 99-00 " Annual growth rate: – 0.83 % " Population
11.73
10.18
9.93
(2001) 23.89 lakhs " Land area (Sq. K.M.) 22,327
8.74
218 organisations received Rs.9.93 crores in 99-00, or an average
of Rs.4.55 lakhs each. Average funds per person came to Rs.41.56.
Average population per organisation was 10,957 people. Average
area under each organisation (in sq. k.m.) was 102 (an area approx.
10 kms. wide and 10 kms. long). 96-97 97-98 98-99 99-00
Meghalaya
Meghalaya " Received Rs.20.78 crores, 24.08 crores, 26.29 crores and 29.44 crores
29.44
in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 12.32 % " Population
26.29
24.08
Mizoram
" Received Rs.0.80 crores, 1.06 crores, 1.57 crores and 0.51 crores in Mizoram
1.57
96-97, 97-98, 98-99, 99-00 " Annual growth rate: – 13.93 % " Population
(2001) 8.91 lakhs " Land area (Sq. K.M.) 21,081
1.06
0.8
12 organisations received Rs.0.51 crores in 99-00, or an average
0.51
of Rs.4.23 lakhs each. Average funds per person came to Rs.5.70.
Average population per organisation was 74,255 people. Average
area under each organisation (in sq. k.m.) was 1,757 (an area
96-97 97-98 98-99 99-00
approx. 42 kms. wide and 42 kms. long).
Nagaland
Nagaland
7.59
" Received Rs.4.35 crores, 5.25 crores, 6.62 crores and 7.59 crores in
6.62
" Population (2001) 19.89 lakhs " Land area (Sq. K.M.) 16,579
4.35
Orissa
111.65
Orissa
" Received Rs.56.05 crores, 56.95 crores, 68.52 crores and 111.65
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 25.83 %
68.52
" Population (2001) 367.07 lakhs " Land area (Sq. K.M.) 155,707
56.95
56.05
14
Pondicherry (UT)
" Received Rs.9.20 crores, 10.67 crores, 11.62 crores and 12.49 crores Pondicherry
12.49
in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 10.73 % " Population
11.62
10.67
(2001) 9.74 lakhs " Land area (Sq. K.M.) 492
9.2
50 organisations received Rs.12.49 crores in 99-00, or an average
of Rs.24.98 lakhs each. Average funds per person came to Rs.128.26.
Average population per organisation was 19,477 people. Average
area under each organisation (in sq. k.m.) was 10 (an area approx.
96-97 97-98 98-99 99-00
2 kms. wide and 5 kms. long).
Punjab
Punjab " Received Rs.14.98 crores, 5.82 crores, 23.83 crores and 35.22
35.22
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 32.97 %
" Population (2001) 242.89 lakhs " Land area (Sq. K.M.) 50,362
23.83
Rajasthan
Rajasthan
37.26
" Received Rs.18.02 crores, 22.97 crores, 30.47 crores and 37.26
30.47
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 27.40 %
" Population (2001) 564.73 lakhs " Land area (Sq. K.M.) 342,239 22.97
18.02
Sikkim
Sikkim " Received Rs.1.26 crores, 0.31 crores, 0.83 crores and 1.15 crores in
1.26
" Population (2001) 5.4 lakhs " Land area (Sq. K.M.) 7,096
0.83
15
Tamil Nadu
" Received Rs.404.98 crores, 416.64 crores, 486.36 crores and 572.51
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 12.23 %
" Population (2001) 621.11 lakhs " Land area (Sq. K.M.) 130,058
Tripura
Tripura
1.81
" Received Rs.1.22 crores, 1.04 crores, 1.81 crores and 1.71 crores in
1.71
" Population (2001) 31.91 lakhs " Land area (Sq. K.M.) 10,492
Uttar Pradesh
U.P.
133.87
128.1
" Received Rs.70.16 crores, 128.25 crores, 133.87 crores and 128.10
128.25
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 22.22 %
Tamilnadu
" Population (2001) 1,745.32 lakhs (incl. Uttaranchal) " Land area 70.16
572.51
486.36
West Bengal
W. Bengal
" Received Rs.158.28 crores, 168.88 crores, 216.42 crores and 233.99
233.99
216.42
crores in 96-97, 97-98, 98-99, 99-00 " Annual growth rate: 13.92 %
168.88
158.28
" Population (2001) 802.21 lakhs " Land area (Sq. K.M.) 88,752
16
State-wise distribution of FC funds: Basic data
Received in 1996-97 Received in 1997-98 Received in 1998-99 Received in 1999-00
State Total # of Av. per Total # of Av. per Total # of Av. per Total # of Av. per
(Rs. Associa Org. (Rs. Associa Org. (Rs. Associ- Org. (Rs. Associ- Org.
Lakhs) tions (Lakhs) Lakhs) tions (Lakhs) Lakhs) ations (Lakhs) Lakhs) tions (Lakhs)
Andaman & Nicobar 136.95 8 17.12 157.13 8 19.64 91.07 7 13.01 23.36 7 3.34
Chandigrah 187.35 14 13.38 140.13 12 11.68 227.6 15 15.17 261.56 17 15.39
Dadra & Nagar Haveli 71.92 9 7.99 40.13 9 4.46 70.79 11 6.44 26.43 12 2.20
Daman & Diu 0.66 3 0.22 — — — 0.00 3 0.00 0.00 3 0.00
Pondicherry 919.77 57 16.14 1,066.87 54 19.76 1,161.89 55 21.13 1,249.05 50 24.98
Andhra Pradesh 35,272.21 1,226 28.77 39,808.09 1,256 31.69 48,729.40 1,539 31.66 53,698.97 1,616 33.23
17
State Total # of Av. per Total # of Av. per Total # of Av. per Total # of Av. per
(Rs. Associa Org. (Rs. Associa Org. (Rs. Associ- Org. (Rs. Associ- Org.
Lakhs) tions (Lakhs) Lakhs) tions (Lakhs) Lakhs) ations (Lakhs) Lakhs) tions (Lakhs)
Kerala 24,229.57 1,450 16.71 25,537.91 1,419 18.00 32,241.89 1,591 20.27 36,169.54 1,483 24.39
Madhya Pradesh 5,781.07 378 15.29 6,034.80 379 15.92 8,066.95 425 18.98 8,457.44 432 19.58
Maharashtra 27,491.46 941 29.22 32,351.76 1,031 31.38 32,261.45 1,183 27.27 35,022.68 1,198 29.23
Manipur 1,017.95 202 5.04 874.28 200 4.37 1,172.98 216 5.43 992.81 218 4.55
Meghalaya 2,077.64 94 22.10 2,407.72 91 26.46 2,628.76 92 28.57 2,943.76 99 29.73
Mizoram 79.79 11 7.25 105.59 9 11.73 157.04 14 11.22 50.76 12 4.23
Nagaland 435.08 40 10.88 524.95 35 15.00 661.87 43 15.39 758.68 42 18.06
18
Orissa 5,604.82 504 11.12 5,694.88 534 10.66 6,851.87 652 10.51 11,165.34 714 15.64
Punjab 1,498.34 72 20.81 581.77 70 8.31 2,382.91 90 26.48 3,522.23 70 50.32
Rajasthan 1,801.52 154 11.70 2,297.46 166 13.84 3,046.97 200 15.23 3,725.91 220 16.94
Sikkim 125.54 4 31.39 30.79 3 10.26 82.75 5 16.55 114.50 4 28.63
Tamilnadu 40,498.42 2,016 20.09 41,663.74 1,991 20.93 48,635.51 2,044 23.79 57,250.88 2,143 26.72
Tripura 121.76 9 13.53 104.27 9 11.59 180.69 10 18.07 171.37 11 15.58
Uttar Pradesh 7,015.57 708 9.91 12,824.64 686 18.69 13,387.43 806 16.61 12,810.46 802 15.97
West Bengal 15,827.56 1,153 13.73 16,887.79 1,124 15.02 21,641.83 1,229 17.61 23,398.74 1,212 19.31
All India 257,169.39 12,136 21.19 286,451.43 12,198 23.48 340,289.52 13,775 24.70 392,462.52 13,986 28.06
*Actual area of Jammu & Kashmir is 2,22,236 sq. kms. However, for this analysis, 1,20,849 sq. kms. illegally occupied by Pakistan and China has been excluded.
Population data is from 2001 census. Land area has been taken from “India 1998”, published by Information & Broadcasting Ministry of Government of India.
Non-Foreign Sources12
Every dollar that comes into India as a grant does not automatically become foreign. There are
numerous exceptions to this. For example, funds received from UN bodies or from Indian
citizens living abroad are not covered by FCRA13 .
13. CCD – Secretariat of the United Nations Convention to Combat Desertification in Countries
Experiencing Serious Drought / or Desertification, Especially in Africa, Bonn
16. CGPRT Centre – The Regional Co-ordination Centre for Research and Development of coarse
Grains, Pulses, Roots, and Tuber crops in the Humid Tropics of Asia and the Pacific, Indonesia
17. CGRFA – Commission on Genetic Resources for Food and Agriculture, Rome
21. CIRDAP – Centre on Integrated Rural Development for Asia and the Pacific, Dhaka
12
Based on AccountAble 40: Non-foreign Sources
13
Foreign contribution (Regulation) Act, 1976. Applicable in India
14
S.O. 1014 (E). Published in Part 2, Sec. 3, sub-section (ii) of Gazette of India – Extraordinary, dated 13-
Nov-2000.
19
22. CITES – Secretariat of the Convention on International Trade in Endangered Species of Wild
Fauna and Flora, Geneva
23. Commission on the Limit of the Continental Shelf, United Nations Divisions for Ocean Affairs
and the Law of the Sea, New York
24. Commonwealth Secretariat, London
25. Department for Disarmament Affairs, New York
26. Department for General Assembly Affairs and Conference Services, New York
27. Department of Economic and Social Affairs, New York
28. Department of Management, New York
29. Department of Peacekeeping Operations, New York
30. Department of Political Affairs, New York
31. Department of Public Information, New York
32. ECA – Economic Commission for Africa, Addis Ababa, Ethiopia.
33. ECE – Economic Commission for Europe, Geneva
34. ECLAC – Economic Commission for Latin America and the Caribbean, Santiago, Chile.
35. ESCAP – Economic Commission for Asia and the Pacific, Bangkok, Thailand
36. ESCWA – Economic Commission for Western Asia, Beirut, Lebanon
37. European Community (EC)
38. FAO – Food and Agriculture Organisation, Rome
39. Global Environment Facility, Washington D.C.
40. IAEA – International Atomic Energy Agency, Vienna
41. IBRD15 – International Bank for Reconstruction and Development, Washington D.C.
42. ICAO – International Civil Aviation Organisation, Montreal
43. ICARDA – International Centre for Agricultural Research in Dry Areas, Syria
44. ICGEB – International Centre for Genetic Engineering and Bio - Technology, New Delhi
45. ICGFI – International Consultative Group on Food Irradiation, Vienna
46. ICLARM – International Centre for Living Aquatic Resource Management, Philippines
47. ICRAF – International Centre of Research in Agro-forestry, Nairobi
48. ICRISAT – International Crops Research Institute for Semi-Arid Tropics, Hyderabad
49. ICSID – International Centre for the Settlement of Investment Disputes, Washington D.C.
50. IDA – International Development Association, Washington D.C.
51. IDB – Inter-American Development Bank, Washington D.C.
52. IFAD – International Fund for Agricultural Development, Rome
15
Commonly known as “The World Bank”.
20
53. IFC – International Finance Cooperation, Washington D.C.
54. IFPRI – International Food Policy Research Institute, Washington D.C.
55. IIMI – International Irrigation Management Institute, Colombo
56. IITA – International Institute of Tropical Agriculture, Nigeria
57. ILO – International Labour Organisation, Geneva
58. ILRI – International Livestock Research Institute, Nairobi
59. IMF – International Monetary Fund, Washington D.C.
60. IMI – International Water Management Institute, Srilanka
61. IMO – International Maritime Organisation, London
62. INCB – International Narcotics Control Board, Vienna
63. INSTRAW – International Research and Training Institute for Advancement of Women, Santo
Domingo, Dominican Republic
64. International Potato Centre, Peru
65. International Rice Research Institute, Manila, Philippines
66. International Seabed Authority, Kingston
67. International Sugar Organisation, London
68. International Tribunal for the Law of the Sea, Hamburg
69. IPCC – Intergovernmental Panel on Climate Change, Geneva
70. IPGRI – International Plant Genetic Resource Institute, Rome
71. ISNAR – International Service of National Agricultural Research, The Netherlands
72. ISTA – The International Seeds Testing Association, Zurich
73. ITC – International Trade Centre (UNCTAD/ WTO), Geneva
74. ITU – International Telecommunication Union, Geneva
75. MIGA – Multilateral Investment Guarantee Agency, Washington D.C.
76. NAM S&T Centre – Centre for Science and Technology of the Non - Aligned and other
Developing Countries, New Delhi
77. Office for Coordination of Humanitarian Affairs, New York
78. Office of Internal Oversight Services, New York
79. Office of Legal Affairs, New York
80. OHCHR – Office of the UN High Commissioner for Human Rights, Geneva
81. OPCW – Organisation for the Prohibition of Chemical Weapons, The Hague
82. Ozone Secretariat to the Vienna Convention for the Protection of the Ozone Layer and the
Montreal Protocol on Substances that Deplete the Ozone Layer, Nairobi
83. PTS for CTBTO – Provisional Technical Secretariat for the Comprehensive Nuclear Test Ban
Treaty Organisation, Vienna
21
84. RNAM – The Regional Network for Agriculture Machinery, Bangkok
85. Secretariat of the Basel Convention on the Control of Trans-boundary Movements of Hazardous
Wastes and their Disposal, Geneva
86. UNAIDS – Joint United Nations Programme on HIV / AIDS, Geneva
87. UNCDF – United Nations Capital Development Fund, New York
88. UNCTAD – United Nations Conference on Trade and Development, Geneva
89. UNDCP – United Nations International Drug Control Programme, Vienna.
90. UNDP – United Nations Development Programme, New York.
91. UNEP – United Nations Environment Programme, Nairobi.
92. UNEP / CMS Secretariat of the Convention on the Conservation of Migratory Species of
Wild Animals (CMS or Bonn Convention), Bonn
93. UNESCO – United Nations Educational, Scientific and Cultural Organisation, Paris
94. UNFCCC – Secretariat of the United Nations Framework Convention on Climate Change,
Bonn
95. UNFPA – United Nations Population Fund, New York.
96. UNHCHR – Office of the UN High Commissioner for Human Rights, Geneva
97. UNHCR – Office of the UN High Commissioner for Refugees, Geneva
98. UNICEF – United Nations Children’s Fund, New York.
99. UNICRI – United Nations Interregional Crime and Justice Research Institute, Rome
100. UNIDIR – United Nations Institute for Disarmament Research, Geneva
101. UNIDO – United Nations Industrial Development Organisation, Vienna
102. UNIFEM – United Nations Development Fund for Women, New York
103. UNITAR – United Nations Institute for Training and Research, Geneva.
104. United Nations Office at Geneva
105. United Nations Office at Nairobi
106. United Nations Office at Vienna
107. United Nations Outer Space Committee
108. UNOPS – United Nations Office for Project Services, New York
109. UNRISD – United Nations Research Institute for Social Development, Geneva.
110. UNRWA – United Nations Relief and work Agency for Palestine Refugees in the Near East,
Ghaza And Aman.
111. UNSCO – United Nations Statistical Office
112. UNSDRI – United Nations Social Defence Research Institute
113. UNU – United Nations University, Tokyo
114. UNV – United Nations Volunteers, Bonn.
22
115. UPO16 – Universal Postal Union, Berne, Switzerland
116. UPOV – International Union for the Protection of New Varieties of Plants, Geneva
117. WARDA – West Africa Development Association, Abidjan
118. WFC – World Food Council
119. WFP – World Food Programme, Rome
120. WHO – World Health Organisation, Geneva
121. WIPO – World Intellectual Property Organisation, Geneva
122. WMO – World Metrological Organisation, Geneva
123. WTO / OMT – World Tourism Organisation, Madrid
This raises a question. What about those UN organisations which are not listed in the notification?
Do these become foreign sources?
We don’t think so. Apparently, UN and its specialized agencies are automatically excluded from
the definition of ‘foreign source’. Under section 2(1)(e)(ii), the Central Government is required to
notify only ‘other agencies’ as non-foreign.
Following is a list of UN offices and its agencies which are not included in the MHA notification.
Please confirm their status with MHA before treating these as non-foreign.
1. ACABQ – Advisory Committee on Administrative and Budgetary Questions, New York (note 2)
2. Ad Hoc Inter – agency Meeting on Women – New York (note 3)
3. Administrative Committee on Coordination (ACC17) - New York (note 3)
4. CCAQ (FB) – Consultative Committee on Administrative Questions (Financial and Budgetary
Questions) - Geneva (note 3)
5. CCAQ (PER) – Consultative Committee on Administrative Questions (Personnel and General
Administrative Questions) - Geneva (note 3)
6. CCPOQ – Consultative Committee on Programme and Operational Questions - Geneva
(note 3)
7. EDI – Economic Development Institute, Washington (note 4)
8. IACSD – Inter - agency Committee on Sustainable Development - New York (note 3)
9. IAMLADP – Inter - agency Meeting on Language Arrangements, Documentation and
Publications, New York (note 3)
10. IBE – International Bureau of Education - Geneva (note 1)
11. ICC – International Computing Centre - Geneva (note 3)
16
As Notified. Nomally called UPU.
17
It has several sub-committees also, such as on drug control, oceans and coastel areas, rural development,
statistical activities, water resources, nutrition, etc.
23
12. ICJ – International Court of Justice - The Hague (note 2)
13. ICS – International Centre for Science and High Technology - Trieste, Italy (note 1)
14. ICSC – International Civil Service Commission - New York (note 2)
15. ILO / ITC – International Training Centre - Turin, Italy (note 1)
16. IMF Institute [part of IMF; exempt u/s 2(e)(ii)]
17. ISCC – Information Systems Coordination Committee - Geneva (note 3)
18. JIAMCATT – Joint Inter - agency Meeting on Computer - assisted Translation and Terminology
- Geneva (note 3)
19. JIU – Joint Inspection Unit - Geneva (note 2)
20. JUNIC – Joint United Nations Information Committee - New York (note 3)
21. OOSA – Office for Outer Space Affairs - Vienna (note 2)
22. Organisational Committee of ACC - New York (note 3)
23. UNCC – United Nations Compensation Commission - Geneva (note 2)
24. UNCHS (Habitat) – United Nations Centre for Human Settlements - Nairobi (note 2)
25. UNCITRAL – United Nations Commission on International Trade Law - Vienna (note 2)
26. United Nations Board of Auditors - New York (note 2)
27. UNJSPF – United Nations Joint Staff Pension Fund - New York, USA (note 2)
28. UNSC – United Nations Staff College - Turin, Italy (note 2)
Notes:
1. Specialized Agency of UN [sec. 2(e)(ii)]
2. Part of UN: a Program [sec. 2(e)(ii)]
3. Part of UN (Inter - Agency Coordination) [sec. 2(e)(ii)]
4. Part of World Bank [sec. 2(e)(ii)]
24
Foreign Sources18
There are agencies which have names similar to UN agencies. This sometimes causes confusion.
The list provided here includes some names of such organizations. It also includes names of
other NGOs / agencies which would be treated as a foreign source under FCRA.
This is merely an illustrative list. There are probably hundreds of other sources which would all
be foreign.
Also remember that some of the grants from Indian Agencies such as CAPART, Concern India
Foundation, National Foundation for India, CRY – Child Relief & You, IGSSS, etc. may be
covered under FCRA.
1. Academic Council on the United Nations System (note 5)
2. Action Aid, UK (note 6)
3. Advocates for Youth, USA (note 3)
4. Aga Khan Foundation, New Delhi / Switzerland (note 2)
5. ALM International, USA (note 3)
6. Asia Foundation, USA (note 3)
7. Asia Society, USA (note 3)
8. Asian Relief, USA (note 3)
9. BRAC, Dhaka (note 3)
10. British Airways (note 4)
11. Business Council for the U.N., USA (note 3)
12. Canadian International Development Agency – CIDA (note 2)
13. CARE International, USA (note 5)
14. Caritas Internationalis (International Confederation of Catholic Charities) (note 6)
15. Catalyst for Women, USA (note 3)
16. Catholic Relief Services - United States Catholic Conference, Inc. (note 6)
17. Childhelp USA, USA (note 3)
18. Childreach, USA (note 3)
19. Children Incorporated, USA (note 3)
20. Children International, USA (note 2)
21. Children’s Aid International, USA (note 2)
22. Children’s Critical Care Alliance, USA (note 3)
23. Children’s Defense Fund, USA (note 3)
24. Children’s Mercy Fund, USA (note 3)
25. Children’s Survival Fund, USA (note 3)
18
Based on AccountAble 41: Foreign Sources
25
26. Children’s Wish Foundation Intl., USA (note 3)
27. Christian Aid (note 2)
28. Christian Children’s Fund, Inc. (note 6)
29. Christian Record Services, USA (note 3)
30. Christian Relief Services, USA (note 2)
31. Church World Service, Inc. (note 6)
32. Commonwealth Human Ecology Council (CHEC) (note 6)
33. Community Aid Abroad (CAA), Australia (note 2)
34. Compassion International, USA (note 2)
35. Concern Worldwide (U.S.), Inc., USA (note 3)
36. Conservation International Fdn., USA (note 3)
37. Council of Europe (note 7)
38. DANIDA, New Delhi / Denmark (note 2)
39. David Livingstone Missionary Fdn., USA (note 3)
40. Defenders of Wildlife, USA (note 3)
41. DFID (earlier called ODA), UK (note 2)
42. Diakonia, Sweden (note 2)
43. Direct Relief International, USA (note 2)
44. Earth Island Institute, USA (note 3)
45. Earthjustice Legal Defense Fund, USA (note 3)
46. Environmental Action Foundation, USA (note 3)
47. European Commission (Directorate-General XIII) (note 7)
48. European Union (note 7)
49. EZE, Germany (note 2)
50. Families International, USA (note 3)
51. Food for the Hungry, USA (note 3)
52. Ford Foundation, USA (note 2)
53. Foreign Embassies, all
54. Foreigners (whether living in India or abroad)
55. Foundation for the Support of the United Nations, Inc. (note 5)
56. Freedom From Hunger, USA (note 2)
57. Friends of the Earth, USA (note 3)
58. Fund for an Open Society, USA (note 3)
59. Fund for Animals, USA (note 3)
26
60. Fund for Peace, USA (note 3)
61. G7 Support Implementation Group - Moscow, Russia (note 7)
62. Gifts In Kind International, USA (note 2)
63. Global 2000 (note 5)
64. Global Fund for Women (note 6)
65. Greenpeace Fund, USA (note 3)
66. Habitat for Humanity International, USA (note 3)
67. Heifer Project International, USA (note 2)
68. Helen Keller International, USA (note 3)
69. HelpAge International (note 5)
70. Heritage Foundation, USA (note 3)
71. Hewlett Packard (note 4)
72. Hunger Project, USA (note 3)
73. IBM (note 4)
74. Institute of International Education, USA (note 3)
75. InterAction: American Council for Voluntary International Action, USA (note 3)
76. INTERMON (note 6)
77. International Air Transport Association (IATA) - Geneva, Switzerland and Montreal, Canada
(note 3)
78. International Christian Aid (note 2)
79. International Committee of the Red Cross (ICRC) - Geneva, Switzerland (note 3)
80. International Cooperative Alliance (note 5)
81. International Council for Adult Education (ICAE) (note 5)
82. International Council of Voluntary Agencies (ICVA) (note 5)
83. International Council of Women (note 5)
84. International Council on Social Welfare (note 5)
85. International Federation of Associations of the Elderly (FIAPA) (note 5)
86. International Federation of Business and Professional Women (note 5)
87. International Federation of the Red Cross and Red Crescent Societies - Geneva, Switzerland
(note 3)
88. International Federation Terre Des Hommes (note 6)
89. International Finance Corporation (IFC), Washington (note 1)
90. International Fund for Animal Welfare, USA (note 3)
91. International Institute for the Unification of Private Law (Unidroit) Rome, Italy (note 7)
92. International Institute of Rural Reconstruction, USA (note 3)
27
93. International Movement ATD Fourth World (note 5)
94. International Organization for Migration (IOM) - Geneva, Switzerland (note 7)
95. International Organization for Standardization (ISO) - Geneva, (note 5)
96. International Organization of Employers (note 5)
97. International Save the Children Alliance (note 5)
98. International Social Security Association (ISSA) (note 5)
99. International Youth and Student Movement for the United Nations (ISMUN) (note 5)
100. Inter-parliamentary Union - Geneva, Switzerland (note 7)
101. Just Say No International, USA (note 3)
102. Local Initiatives Support Corporation, USA (note 3)
103. Lutheran World Federation (note 6)
104. MacArthur Foundation (note 2)
105. Make-A-Wish Fdn. of America, USA (note 2)
106. MAP International (note 3)
107. Microsoft (note 4)
108. Miserior (note 2)
109. Motorola (note 4)
110. Muslim World League (note 5)
111. Netherlands Organization for International Development Cooperation (note 6)
112. Nippon International Cooperation for Community Development (note 6)
113. NORAD (note 2)
114. NOVIB (note 2)
115. Organisation for Economic Co-operation and Development (OECD) – Paris, France (note 7)
116. Organization for International Economic Relations (IER) (note 6)
117. Organizations and Women’s Groups of German Associations, E.V. (note 6)
118. Overseas Development Council, USA (note 3)
119. Oxfam (America), Boston (note 6)
120. Oxfam (United Kingdom and Ireland) (note 6)
121. Oxfam Hongkong (note 2)
122. Partners of the Americas, USA (note 3)
123. Pathfinder International, USA (note 3)
124. Pearl S. Buck Foundation, USA (note 3)
125. People-to-People International, USA (note 3)
126. PLAN International, USA (note 2)
28
127. Population Action International, USA (note 2)
128. Priority One International (note 3)
129. Project Concern International, USA (note 3)
130. Project Cure, USA (note 3)
131. Project Hope, USA (note 3)
132. Resources for the Future, USA (note 3)
133. Save the Children Federation, USA (note 2)
134. SOS – Kinderdorf International (note 6)
135. SOS Drugs International (note 6)
136. Swedish International Development Agency (Sida) (note 2)
137. Swiss Aid (note 2)
138. Swiss Agency for Development and Cooperation (note 2)
139. Terre Des Hommes (note 2)
140. U.S. Committee for Refugees, USA (note 3)
141. U.S. Committee for UNICEF, USA (note 3)
142. U.S. Olympic Committee, USA (note 3)
143. UN Association of the U.S.A., USA (note 3)
144. Unitarian Universalist Service Committee, USA (note 2)
145. United Children’s Fund, USA (note 3)
146. United Way of America, USA (note 3)
147. USAID, USA (note 2)
148. USO (United Service Organizations), USA (note 3)
149. Wildlife Preservation Trust Intl., USA (note 3)
150. Women’s International Democratic Federation (note 5)
151. World Assembly of Youth (WAY) (note 5)
152. World Concern, USA (note 3)
153. World Education, USA (note 3)
154. World Emergency Relief, USA (note 3)
155. World Federation of UNESCO Clubs, Centres and Associations (note 6)
156. World Federation of United Nations Associations (WFUNA) (note 5)
157. World Learning Inc., USA (note 3)
158. World Mercy Fund, USA (note 3)
159. World Neighbors, USA (note 3)
160. World Resources Institute, USA (note 3)
29
161. World Trade Organization (WTO) - Geneva, Switzerland (note 7)
162. World University Service (note 6)
163. World Vision International (note 6)
164. World Wide Fund for Nature International (note 5)
165. World Young Women’s Christian Association (note 6)
166. Worldwide Network - Women in Development and Environment (note 5)
Notes:
1. IFC is legally independent of the World Bank, and therefore, not exempt from FCRA
2. International NGO / Funding Agency
3. Foreign NGO/ Agency
4. Multinational Corporation
5. International NGO / Funding Agency; has General Consultative status with UNO
6. International NGO / Funding Agency; has Special Consultative status with UNO
7. International organization with member states
30
Profiles of Top FC Donors19
The yearly MHA (Ministry of Home Affairs) report on foreign contribution gives a list of the top
25 donors. It also gives the amount given by them. If you combine these for last four years
(96-97 to 99-00), total of 39 such names emerge.
Who are these people? What kind of work do they support? The MHA report does not say
anything on this. Therefore, a brief profile of each agency has been prepared from various
sources.
Please also read “Souces and Caution” on page 1. It provides a summary of the limitations on
this analysis.
70.76
43.19
Programme focus is on health, education, livelihood and environment. As of June 1999, the total
number of children being assisted worldwide was 11.6 lakhs. Out of these, about 90,000 children
are supported by US sponsors and donors. Specific assistance to individuals22 in 98-99 came
to US$ 140 million (Rs.588 Crores).
Indian counterpart – Foster Parents Plan International23 is registered in New Delhi and Indian
disbursement is mainly routed through this.
19
Based on AccountAble 68, 74, 75: Profiles of Top FC Donors
20
FPPI’s US member is also named Plan International USA Inc. d.b.a. Childreach. ‘d.b.a.’ means ‘doing
business as’.
21
Called sponsors
22
This represents assistance released directly by FPPI (source: IRS form 990 for year ending June ’99).
23
Also see ‘2. Foster Parents Plan International’ on page 45
31
2. EZE
" Registered in Bonn, Germany " Founded in 1962 " Grants
to Indian NGOs: Rs.49.36 crores, 59.03 crores, 55.03 crores, 49.50
crores in 96-97, 97-98, 98-99, 99-00 respectively " Annual growth
in India disbursement: 0.09% " www.ekd.de/agked/ezee.html
It provides long-term sustainable assistance to poor children around the world regardless of
race, creed, nationality or gender. Funds are raised through sponsorship of children from USA
(75%) and other countries (25%).
Total international programme grants were $ 93.9 million (Rs.394 crores) for the year 1998. Out
of this, around 10 to 15% is disbursed to India.
CCF’s Indian branch – Christian Children’s Fund Inc. is registered under FCRA in Bangalore and
in New Delhi.
24
EZE and three other German protestant organisations (SO – Service Overseas, KED – Churches
Development Service, FMS – Federation of Missionary Societies in Germany) have recently merged into
a new organisation called EED – Evangelische Entwicklungs Dienst (Church Development Service). The
fifth protestant organisation, BFW – Bread for the World, did not merge into EED.
25
Literally, ‘Evangelist Central Office for Development Assistance’. The German abbreviation ‘e.v.’ stands
for ‘eingetragener verein’, i.e. registered association.
26
In Germany (and five other OECD countries), the Government collects a special tax called ‘Church Tax’
along with income tax. In Germany, this tax (called Kirchensteuer) comes to about 8-9% of the income tax.
It is collected only from tax-payers registered with one of the main churches (such as Catholics, Lutherans
or Protestants). These funds are used for charitable and religious activities across the world. In 1999, the
church tax came to about DM 17 billion (~Rs. 39,100 crores).
27
China
32
4. Missio
Missio
" Based in Germany " Grants to Indian NGOs: Rs.58.66 crores, 48.93
58.66
crores, 43.78 crores, 35.14 crores in 96-97, 97-98, 98-99, 99-00
48.93
43.78
respectively " Annual growth in India disbursement: – 15.7%
35.14
" www.missio-aachen.de/
5. ACTIONAID
" Based in London, UK " Registered as Company limited by guarantee
ActionAid " Also registered with Charity Commission for England and Wales
58.81
" Grants to Indian NGOs: Rs.31.42 crores, 42.47 crores, 48.05 crores,
48.05
Main programme emphasis is on improving quality of life of children, families and poor communities.
The approach is integrated development of community.
33
7. Kinder Not Hilfe
" Based in Germany " Founded in 1959 " Registered charitable
association " Member of the Diaconic Services of the Evangelical
Church in the Rhineland, Germany " Grants to Indian NGOs: Rs.40.02
crores, 46.31 crores, 33.43 crores, 43.76 crores in 96-97, 97-98, 98-99,
99-00 respectively " Annual growth in India disbursement: 3.02 %
" www.kindernothilfe.de
Kinder Not Hilfe means ‘help for children in need’. Main area of
emphasis is basic education, vocational training, nutrition, clothing
and medical care to children. It also supports parents of these
children. It supports about 1,20,000 children in 25 countries mainly
in India, Philippines, Brazil, Chile, Ethiopia and South Africa. Its partners are mainly Churches,
congregations or Christian organisations.
The donation income of Kinder Not Hilfe in Germany was about DM 82.9 million (Rs.190 crores)
in the year 1999.
Total worldwide programme grants in 1997-98 and 1998-99 were $350 million (Rs.1,470 crores)
and $397 million (Rs.1,707 crores). Grants to India34 came to about 3%.
Indian counterpart – World Vision of India35 is registered in Tamil Nadu and Indian disbursement
is mainly routed through this.
9. MISEREOR
" Based in Aachen, Germany " Founded in 1958 " Grants to
Indian NGOs: Rs.38.64 crores, 39.76 crores, 35.52 crores, 34.31 crores
in 96-97, 97-98, 98-99, 99-00 respectively " Annual growth in India
disbursement: – 3.88% " www.misereor.org (International)
" www.misereor.de (Germany)
34
World Vision International receives funds from World Vision Inc. (Federal Way, Washington, USA),
among others. These funds are then passed on to counterparts such as in India. In 98-99 (Oct- Sep), World
Vision International disbursed $11.22 million (~Rs.48 crores) to India (source: IRS form 990).
35
Also see ‘4. World Vision of India’ on page 45
34
MISEREOR36 works in cooperation with KZE37 , under the direction and responsibility of the
German Catholic Bishops’ Conference. It supports development projects based on the principle
of “help towards self-help”, regardless of ethnicity, gender, creed or nationality.
MISEREOR raises funds in three main ways : direct donations, from the German Dioceses, and
from the German Government through KZE38. Together these came to about DM 297 million. Out
of this, it donated DM 280 million (Rs.641 crores) to various projects.
MISEREOR receives about 4,000 applications a year. In 1999, it supported 1,699 development
projects in over 100 countries of Africa, Asia and Latin America. Out of this India received DM
30 million (Rs.69 crores39).
Main partners in India are IGSSS40 and Caritas India41 . These agencies in turn make grants for
small-scale projects.
The Ford Foundation is a private, non-profit, philanthropic organisation. Its funds are derived from
investment portfolio gifted by Henry and Edsel Ford (Ford Motor Company). The Foundation’s
36
Full name in German is ‘Bischöfliches Hilfswerk MISEREOR e.V.’. It means ‘The German Catholic
Bishops’ Organisation for Development Cooperation’.
37
Full name in German is ‘Katholische Zentralstelle für Entwicklungshilfe e.V.’. It means ‘The German
Catholic Central Agency for Development Aid’.
38
DM 124 million, DM 25 million, DM 148 million respectively. KZE funds come from the German Church
tax.
39
Figures taken from Misereor Annual Report for 1999 on its web-site. These may not tie up with FC funds
reported as received in India due to a variety of reasons. For example, some NGOs may report funds as
received directly from KZE.
40
Also see ‘16. IGSSS ‘ on page 49
41
Also see ‘15. Caritas India ‘ on page 49
42
A Spanish phrase meaning ‘United Hands’
43
Spanish official agency
35
investment portfolio was valued at $11.8 billion (~Rs.51,000 crores)
at the end of fiscal year 1999.
Ford has wide-ranging programme interests including community development, asset building,
peace, social justice and education, media, arts, culture and encouragement of philanthropy.
ICCO works through church and non-church organisations in these countries. Its grants range
from Rs.60,000 to Rs.10 crores.
44
At current exchange rates
45
Primarily grants to organizations and individuals, direct charitable activities and programme support
46
ICCO’s cooperation partners are MDO/Churches in Action; Woord en Daad; OREON; ZOA Refugeecare;
TEAR fund; Protestant Christian Churches; Young Management; Doe Wel (“Do Good”, deaconry of the
Reformed Congregations in the Netherlands); ICS; ZZG; Interservice Netherlands; Aids Fonds; Foundation
for Christian Education; Passage; Fund for Hope for Children
36
14. Christian Aid
" Based in London, UK " Founded in 1945 " Registered with Charity
Commission for England and Wales " Grants to Indian NGOs: Rs.20.33
crores, 19.47 crores, 22.31 crores, 35.41 crores in 96-97, 97-98, 98-99,
99-00 respectively " Annual growth in India disbursement: 20.32%
" www.Christian-aid.org.uk
It is mainly funded by churches and government agencies of UK and Ireland. Total donation
income in 1999-2000 came to £41.4 million (~Rs. 290 Crores). It operates in 60 countries
through 16 overseas offices including India. Main emphasis is on empowering people and
eradication of poverty.
16. IPPF
" Based in London, UK " Founded in Bombay in 1952 " Registered
with Charity Commission for England and Wales " Grants to Indian
NGOs: Rs.22.13 crores, 21.45 crores, 20.98 crores, 18.07 crores in 96-
97, 97-98, 98-99, 99-00 respectively " Annual growth in India
disbursement: – 6.53% " www.ippf.org
IPPF now links national autonomous Family Planning Associations (FPAs) in over 180 countries
worldwide. These associations are committed to promote the family planning and reproductive
health, irrespective of race, creed, political belief, gender, or age.
IPPF also campaigns locally, regionally and internationally, through policy makers, opinion
leaders, professionals and the media to increase support for above.
Indian counterpart – Family Planning Association of India (FPAI) is registered in Mumbai, and
Indian disbursement is mainly routed through this.
37
17. Foundation Vincent Ferrer
" Based in Spain " Grants to Indian NGOs: Rs.34.60 and 45.54
crores in 98-99, 99-00 respectively. Figures for 96-97 and 97-98 not
available
18. Bilance
" Based in Netherlands " Grants to Indian NGOs: Rs.15.23 crores,
18.77 crores, 23.46 crores, 20.96 crores in 96-97, 97-98, 98-99, 99-00
respectively " Annual growth in India disbursement: 11.23% " http:/
/antenna.nl/bilance " www.cordaid.nl
19. USAID
" Based in USA " Founded in 1961 " Grants to Indian NGOs:
Rs.42.79 crores, 27.21 crores in 97-98, 98-99 respectively. Figures for 96-
97 and 99-00 not available " www.usaid.gov
38
21. Gospel for Asia
" Based in USA " Grants to India program: Rs.26.93 crores, 32.62
crores in 96-97, 99-00 respectively. Figures for 97-98 and 98-99 not
available " Annual growth in India disbursement: 6.6% " www.gfa.org
Indian counterpart – Gospel for Asia is registered in Kerala and Indian disbursement is mainly
routed through this.
The organisation supports various schools, oratories and youth centers, technical and professional
training centers, parishes, foreign missions, and activities in the realm of mass media and social
communications.
39
25. Bread for the World
" Based in Germany " Grants to Indian NGOs: Rs.18.45 crores,
16.04 crores, 13.57 crores in 96-97, 97-98, 99-00 respectively. Figures
for 98-99 not available " Annual growth in India disbursement: – 9.73%
" www.breadworld.com (USA) " www.brotfuerdiewelt.de (Germany)
Bread for the World and its partners in poor countries encourage the empowerment of the poor
through more than 2,000 projects and programs per year.
CHI provides help for adoption through each step of the paperwork,
immigration and naturalization process, state requirements,
country legalization requirements, and ultimately, country of choice
requirements. It has agents in each country who provide support
through the entire process.
It has been working in India for last 20 years and hundreds of children have been placed with
adaptive families. CHI is also working in Russia, Romania, Moldova, Bulgaria, China, Bolivia,
Guatemala, Peru, the Marshall Islands, and Vietnam.
40
28. Manos Unidas Afonso TED Manos Unidas Afonso
22.75
" Based in Madrid, Spain " Grant made Rs.16.77 crores, 22.75 crores
in 96-97, 97-98 respectively. Figures for 98-99 and 99-00 not available
16.77
" www.manosunidas.org " www.mansunides.org
Indian counterpart – Lutheran World Service-India is registered in West Bengal (Kolkata) and
Indian disbursement is mainly routed through this.
Maharishi Education Foundation is part of a global group of institutions associated with Maharishi
Mahesh Yogi.
47
See ‘5. Mata Amritanandmayi Mission’ on page 46
48
Any place of worship is technically called a church under US Tax law.
41
Its Indian parent – Mata Amritanandmayi Mission is registered in Kerala and funds are mainly
routed through the parent body.
20.57
" Based in Netherlands " Grants to India program: Rs.17.44
17.44
crores, 20.57 crores in 98-99, 99-00 respectively. Figures for 96-97
and 97-98 not available " www.hivos.nl/Engels/index.htm
Majority of Hivos funds come from Dutch Govt. In 1998 Hivos provided financial aid to over 750
partner organisations (1997: over 700) in Africa, Asia and Latin America. Hivos spent 106.8
million guilders on their initiatives (compared with 98.5 million in 1997).
Indian counterpart – The Save the Children Fund is registered in New Delhi and Indian disbursement
is mainly routed through this.
42
In 1999, SDA World Church raised $1,606 million49 as tithe and offerings. It gave away $159
million to 3,615 projects in 124 countries through its donor agency, ADRA50 . It also added 1.09
million members, or a new member every 29 seconds. A new church was organised every 5
hours51 . It ran 166 hospitals, 5,846 normal schools and 1,10,229 Sabbath schools52 worldwide.
Indian counterpart – Services Association of Seventh Day Adventists Pvt. Ltd. is registered in
Tamil Nadu as a company and Indian disbursement is mainly routed through this. By 30-Jun-
01, SDA had 1,397 churches and 5.21 lakh members in India.
Started in 1949 by Hermann Gmeiner. He built the first SOS Children’s Village in Imst, Austria
and named it the “House of Peace” 53. By 2002, SOS Villages was operating in 131 countries.
In 1999, SOS raised € 180 million. This is equivalent to about Rs.864 crores. Its Indian member
association is SOS Children’s Village of India in New Delhi. Indian disbursement is mainly
routed through this.
36. ZEH
" Based in Germany " Grants to Indian NGOs: Rs.21.12 crores in 99-00. Figures for 96-97, 97-98, 98-
99 not available
Soka Gakkai International (SGI) began in 1930 as an educators group, called the Soka Kyoiku
Gakkai (Value Creating Education Society). It is an international Buddhist association with over
12 million members from 76 constituent organisations in 181 countries and territories. SGI’s
humanitarian assistance efforts are based on the long-standing principles of Nichiren Buddhism.
Its Indian counterpart – Bharat Soka Gakkai is registered in New Delhi and the Indian disbursement
is mainly routed through this.
49
About Rs.7,226 crores
50
Adventist Development and Relief Agency International
51
www.adventist.org/worldchurch/factsandfigures.html
52
Religious schools
53
Original goal of Hermann Gmeiner was to provide a family, a house, a village to the orphans of war and
abandoned children.
43
Profiles of Top FC Receivers54
The yearly MHA55 report on foreign contribution gives a list of top 25 receivers. It also gives the
amounts received by them. If you combine the lists for last four56 years, 38 such names emerge.
Who are these people? What kind of work do they carry out? The MHA report does not say
anything on this. Therefore, a brief profile of each organization has been prepared from other
sources. However, there are two important points regarding this:
1. Identity: Multiple FCRA registrations may exist due to various reasons. These organisations
may be totally independent, part of the same group or branches of the same organisation.
Society Registrars do not verify whether organisations with similar names exist in other
states before registering a society. It is not necessary that each of the branches will receive
FC funds independently. Often, the funds are received centrally and then passed on to
branches.
2. Caution: Profiles of the receivers have been compiled from various sources, including the
Internet. We hold out no warranties for the accuracy or fairness of the information. Please
verify the information on your own before arriving at any decisions. We have also avoided
the use of religious honorifics. This is not intended as disrespect to the religious beliefs of
any person.
68.1
64.4
56.5
" Annual growth rate: 19.1% " www.maharishi-india.org
40.3
This is part of a global network of institutions working on Maharishi
Mahesh Yogi’s vision. The group is mainly working on health,
spiritual, educational matters based on Hindu Vedic culture.
Of these four, the first one’s receipts are included in top 25 category.
54
Based on AccountAble 64, 65: Profiles of Top FC Receivers
55
Ministry of Home Affairs
56
96-97 to 99-00
44
2. Foster Parents Plan International
" Registered in Delhi " Received Rs.35.9 crores, 44.3 crores, 42.9 FPPI
63.7
crores and 63.7 crores in 96-97, 97-98, 98-99, 99-00 " Annual
42.9
growth rate: 21.1% " www.plan-internaional.org/international/about/
44.3
35.9
where/india.html
crores, 39.8 crores and 50.2 crores in 96-97, 97-98, 98-99, 99-00
47.7
39.8
42.9
Of these six, the first one’s receipts are included in top 25 category.
45
5. World Vision of India, Nagaland
Of these seven, the first one’s receipts are included in top 25 category.
53.1
" Annual growth rate: 24.4% " www.ammachi.org
51.6
The mission was started in Kollam in 1979. It is associated with
34.3
Mata Amritanandamayi Devi, who is a Hindu Satguru57 . The
mission is mainly involved in spreading her teachings but has
also undertaken several charitable and educational projects,
including an orphanage, colleges, hospitals, housing for widows,
etc.
In 98-99, two FC-3 were filed with similar names:
Of these two, the first one’s receipts are included in top 25 category.
6. Actionaid
ActionAid
" Registered in Karnataka " Received Rs.24.8 crores, 32 crores,
39.2
36.4
36.4 crores and 39.2 crores in 96-97, 97-98, 98-99, 99-00 " Annual
growth rate: 16.5% " http://actionaidindia.org/
32
24.8
Of these two, the first one’s receipts are included in top 25 category.
22.2 crores and 29.4 crores in 96-97, 97-98, 98-99, 99-00 " Annual
24.7
23.3
growth rate: 8%
57
Spiritual teacher
58
A foreign company limited by guarantee
59
Church of South India
46
8. SOS Children’s Village of India SOS Children Village
31.7
" Registered in Delhi " Received Rs.16.9 crores, 20.3 crores, 28
crores and 31.7 crores in 96-97, 97-98, 98-99, 99-00 " Annual
28
growth rate: 23.3% " www.soscvindia.org
20.3
16.9
This is a secular organisation providing shelter and care to children
all over India. Working in India since 1964. It runs 32 ‘villages’,
which are communities for orphaned or abandoned children. Also
does fund-raising in India. It is a member of SOS Kinderdorf
International.
In 96-97, five FC-3 were filed with similar names:
Of these five, the first one’s receipts are included in top 25 category.
9. CASA
" Registered in Delhi " Received Rs.17.3 crores, 20.1 crores, 24.3
crores and 34.1 crores in 96-97, 97-98, 98-99, 99-00 " Annual growth
rate: 25.4%
work.
17.3
26.5
Kinderdorf International.
In 96-97, five FC-3 were filed with similar names:
Of these five, the first one’s receipts are included in top 25 category.
47
11. Oxfam (India) Trust
Oxfam (I) Trust
34.6
" Registered in Delhi " Received Rs.15.3 crores, 15.9 crores,
21.9 crores and 34.6 crores in 96-97, 97-98, 98-99, 99-00 " Annual
21.9
growth rate: 31.2% " www.netecho.com/oxfam/
15.9
" www.oneworld.org/oxfam/
15.3
Oxfam India Trust is the program arm of Oxfam, Great Britain.
It is a secular grant-making agency, working in India for several
decades. Also involved in advocacy and disaster relief. It has
several offices all over India. 96-97 97-98 98-99 99-00
Of these four, the first one’s receipts are included in top 25 category.
crores and 33 crores in 96-97, 98-99 and 99-00. Figure for 97-98 not
available " Annual growth rate: 18.9%
19.6
RDT
14. Rural Development Trust
45.4
45.4 crores in 98-99 and 99-00. Figures for 97-98 and 98-99 not
available.
60
Issue dated 10th September 1998
48
15. Caritas India Caritas
31.8
" Registered in Delhi " Received Rs.14.7 crores, 15.5 crores,
16.8 crores and 31.8 crores in 96-97, 97-98, 98-99, 99-00 " Annual
16.8
growth rate: 29.3% " www.caritasindia.org
15.5
14.7
Set up by the Catholic Bishops Conference of India. ‘Caritas’
means charity. It has twelve regional offices in India. It is part of
the Caritas International (www.caritas.org). Caritas views itself as
a socio-pastoral expression of the Church and is engaged in
fighting poverty and for the rights of the poor.
16. IGSSS
IGSSS
" Registered in Delhi " Received Rs.14.8 crores, 17 crores, 18.8
23
crores and 23 crores in 96-97, 97-98, 98-99, 99-00 " Annual growth
18.8
rate: 15.8%
17
14.8
32.3
32.3 crores in 96-97, 97-98 and 99-00. Figures for 98-99 not available
" Annual growth rate: 7.4% " www.gfa.org
26.1
14.4
Gospel for Asia is a Christian missionary organisation based in
USA. It was founded in 1979. Its aim is to spread the teachings
of Jesus Christ. It also trains and supports missionaries and
sets up churches. In 1999, it raised Rs.70 crores. Of this, about
Rs.52 crores was spent on direct program.
96-97 97-98 98-99 99-00
18. SIFPSA
42.8
" Registered in Uttar Pradesh " Received Rs.42.8 crores and 27.1
crores in 97-98 and 98-99. No FC-3 filed in 96-97. Figure for 99-00 not
27.1
15.6
15.2
19. MYRADA
" Registered in Karnataka " Received Rs.17.2 crores, 15.6 crores,
15.2 crores and 19.4 crores in 96-97, 97-98, 98-99, 99-00 " Annual
growth rate: 4.1% " www.myrada.org
49
MYRADA (Mysore Resettlement and Development Agency) is supported by 37 donors including
Plan International, SDC, NOVIB, CHF, EZE and the Government. It is based in Bangalore and
works mainly in Karnataka, Andhra Pradesh and Tamilnadu. It is involved in many activities,
including micro-credit, watershed and education.
21.6
22.2
21.2
" Registered in Mumbai " Received Rs.22.2 crores, 21.6 crores
and 21.2 crores in 96-97, 97-98, 98-99. Figure for 99-00 not available
" Annual growth rate: – 2.3% " www.fpaindia.com
LKMMT
17.1
SRM Foundation
22. SRM Foundation of India
33.2
" Registered in Delhi " Received Rs.16.9 crores and 33.2 crores in
98-99, 99-00. Figures for 96-97 and 97-98 not available.
16.9
26
50
7. The Leprosy Mission Comprehensive H C U, Andhra Pradesh
8. The Leprosy Mission Home And Hospital, Punjab
9. The Leprosy Mission Hospital, Andhra Pradesh
10. The Leprosy Mission Hospital, Andhra Pradesh
11. The Leprosy Mission Hospital, Bihar
12. The Leprosy Mission Hospital, Uttar Pradesh
13. The Leprosy Mission Incorporation With…, Andhra Pradesh
14. The Leprosy Mission Of India, Delhi
15. The Leprosy Mission Purulia, West Bengal
16. The Leprosy Mission, Bihar
17. The Leprosy Mission, Uttar Pradesh
18. The Leprosy Mission, Uttar Pradesh
19. The Leprosy Mission, West Bengal
Of these 19, the first one’s receipts are included in top 25 category.
20
15.9
and 20 crores in 97-98, 98-99, 99-00. Figures for 96-97 not available
" Annual growth rate: 27.5% " www.ccci.org
12.3
Indian associate of Campus Crusade for Christ, Inc., which is
based in Orlando, USA. In 98-99, the US office raised around
Rs.1,600 crores through several affiliated organisations. It is an
evangelistic organisation, working to promote Christianity in various
ways, including through sports (Athletes in Action).
Of these two, the first one’s receipts are included in top 25 category.
26. BAPS
" Registered in Gujarat " Received Rs.16.5 crores and 28.3
crores in 96-97 and 99-00. Figures for 97-98 and 98-99 not available
" Annual growth rate: 19.7% " www.swaminarayan.org/
51
27. Central Tibet Relief Committee
CTRC
" Registered in Himachal Pradesh " Received Rs.14.9 crores and
19.3
19.3 in 98-99 and 99-00. Figures for 96-97 and 97-98 not available
14.9
" www.tibet.com/Paljor/ctrc.html
Headed by the Dalai Lama. CTRC (HH Dalai Lama Central Tibetan
Relief Committee) was registered as a society in 1981. It serves
as the relief and development wing of the Central Tibetan
administration. It provides relief, rehabilitation as also social, cultural
and economic support to the Tibetan refugees.
In 96-97, three FC-3 were filed with similar names:
Of these three, the first one’s receipts are included in top 25 category.
The Indian branch was set up in 1970. It works mainly with leprosy patients and has also
established an eye-hospital in Rajahmundry.
61
Spreading Jesus Christ’s teachings; converting to Christianity by preaching
62
Religious conversion, often by inducement
52
31. Community Aid Sponsorship Program
" Registered in Maharashtra " Received Rs.20.1 crores, in 96-97. Figures for other years not
available.
One of the first partners of Plan International, with partnership dating back to 1980s. Also
known as CASP-PLAN. Also supported by USAID.
Part of Soka Gakkai International. This is a religious association based in Japan, which is
committed to spreading the values of Nichiren Buddhism.
Runs Churches, Hospital, 77 schools (sponsored by Mission of Mercy63 ) and Bible schools.
Serves eleven states including the Northeast. ‘Assemblies of God’ is the largest Pentecostal
Church and is viewed as a fundamentalist Protestant group. Active in evangelism. Headed by
Huldah Buntain, an American missionary working in India since 1954. She is also co-founder
of ‘Mission of Mercy International’.
In 98-99, eight FC-3 were filed with similar names:
Of these eight, the first one’s receipts are included in top 25 category.
Based in Lonavala, Pune. It is linked to The Watchtower Bible and Tract Society of New York,
Inc. This is a legal organization in use by Jehovah’s Witnesses (www.jw-media.org).
Jehovah’s Witnesses is an evangelical organisation. Its members are probably best known for
their person-to-person ministry. Each congregation tries to reach all the people in its neighborhood
with a brief Bible message at least once a year. This is usually done by Witnesses visiting
from door to door. Witnesses also talk to people on the streets, in parks and in other public
places – wherever someone can be found who has a spiritual interest and a few minutes to
63
A part of Bethesda Ministries of Colorado Springs, Colorado, USA
53
talk. If a Witness finds someone who is interested in learning more about the Bible, further
discussions are arranged, or an appointment for a weekly home Bible study is made.
Since 1926, Jehovah’s Witnesses have printed 10 crore copies of the Bible in 34 languages.
35. ASSEFA
" Registered in Tamilnadu " Received Rs.12.9 crores in 96-97. Figures for other years not available
" www.gdrc.org/icm/assefa.html
Called Association for Sarva Seva Farms. Based in Chennai. Formed in 1969 as an agency to
help people who received land under ‘Bhoodan’. Now works in six states on multiple issues
including credit, child labor, education, health, environment, etc.
Offices in Pune and Delhi. Involved in residential child care and community based programs
for children. Makes grants to other NGOs working on these issues. Programs mainly in North
India.
Holistic Child Development of India was earlier a part of CNI64 Council for Child Care.
Established by Prince Aga Khan (49th Imam of Ismaili Muslims) in 1967. AKF is the Indian
office of the main foundation, based in Geneva, Switzerland. It is also part of Aga Khan
Development Network. Provides grants and supports various development projects on health,
education, rural development and enhancement of NGOs.
In 96-97, four FC-3 were filed with similar names:
Of these four, the first one’s receipts are included in top 25 category.
64
Church of North India
54
Section II: Procedures
All NGOs need either prior-permission or FCRA registration before they can accept foreign
contribution. However, getting this permission or registration is not so simple as it sounds. And
getting FCRA registration may be the beginning of your problems, rather than the end.
In this section, we try to take you through the simple-complex procedures of FCRA. Simple-
complex? Well, simple for those of you who have dealt with company law and exchange
regulations, but extremely complex for most NGO people, whose only brush with bureaucracy
may have been the issue of a driving license!
Prior Permission 57
FCRA Registration 63
Basics of FC-3 70
Intricacies of FC-3 75
Maintaining form FC-6 84
FCRA Fellowships 89
FCRA Penalties 93
‘Prior-permission’ is what you need, if you are an NGO (or a non-profit like a Hospital or a
University), want to accept foreign funds. However, if you are going to receive foreign funds
regularly, you should get ‘FCRA Registration’, so that you don’t have to apply for permission
again and again.
Either way, you need to fill up form FC-3 each year, when you receive foreign funds. And if you
have FCRA registration, you have to file this form, even if you haven’t received any!
Filling up FC-3 can sometimes become quite complicated – this is dealt with under ‘Intricacies
of FC-3’. Then sometimes, you have to maintain a stock ledger in form FC-6. This happens if
you have received foreign contribution in kind (blankets, rations, etc.).
You should read ‘FCRA Fellowships’, if you are a scholar and are receiving any stipend or
scholarships from foreigners. You may also want to read this if you are not a scholar, but are
going abroad for training or a study tour.
What happens if you fall foul of FCRA? Read all about it in a pleasant chapter titled ‘FCRA
Penalties’. If that doesn’t sound very pleasant, then read AND follow all the other chapters…
55
56
Prior Permission1
Prior-permission is given to NGOs by FCRA department to accept foreign contribution on a
case-by-case basis. This permission should be obtained before accepting the contribution.
Procedure
Apply in FC-1A
For getting prior-permission, you have to file form FC-1A along with required documents.
Field Inquiry
If your documents are complete, some one from the Intelligence Bureau will visit your main
office.
He may look at your accounts and ask questions from you and your neighbours. He may also
inquire at the local Police Station or visit the field area.
If you wish, you can also file an appeal against the rejection in the High Court within 60 days
of date of letter [sec. 21].
Common doubts
More than once
You can get prior-permission more than once. In fact, you can have two or more projects running
side-by-side under prior-permission.
Tailor-made
Each prior-permission is tailor-made. This means you can not use it for a different project or
same project under a different agency.
1
Based on AccountAble 33: Prior Permission
2
See ‘Changes in office bearers’ on page 68
57
Joint grants
If your project is being funded jointly by two or more Agencies, you can apply for both on one
form only. You will then get a prior-permission, which covers both.
Maximum Amount
There is no minimum or maximum limit for prior-permission. For example, there are cases where
prior-permission has been given for Rs.1 crore also.
However, FCRA Department is also generally reluctant to give large approvals under prior-
permission. The bigger your proposal, the higher it will go for approval.
How early
Prior permission can be obtained in the first year itself, even before the first year’s accounts
are finalised. But this will happen only if the Department is fully satisfied about your credibility
and accountability.
Advance Credit
If you have already received the funds in your account by bank transfer, do not spend the money
till you receive permission. If your application is rejected, you will have to return the funds.
Automatic permission?
Many people think that permission is automatically granted if you don’t get a reply in 90 or 120
days. This is not correct!
The Act says that your application must be disposed within 90 or 120 days. This means a
decision must be taken within that time.
The Act does not say that this decision must be communicated within 90 or 120 days to the
applicant.
As a matter of practice, the Department always sends a reply. If you don’t get a reply, it may
merely mean that it has been returned undelivered, delayed in post or wrongly delivered. Please
check with them.
Filing FC-3
You have to file FC-3 at the end of each financial year (by 31st July). This will continue year
after year till the time the FCRA funds you received are exhausted.
Filling up FC-1A
In form FC-1A3 there are 11 main items of information. Fill up the entire form in CAPITAL letters
only.
1. Background
Applicant: Start with writing the Chief Functionary’s name in the blank space (‘I,……..’). This
means the person who is directly responsible for day to day running of the NGO.
A different person can also make this application. This person has to be an office bearer and
should have been authorized through a resolution of the Governing body.
(i) Name and address: Give the name and postal address of the NGO. The SIB officers will
visit this office to make inquiries. This may be different from your registered office.
3
See page 127 for form FC-1A
58
(ii) Registration details: Give details of your registration as a Society or a Trust here. Non-
profit companies also need to give these details.
(iii) Nature of Association: This depends on the work you plan to do. If your main work is
development, then you can just tick ‘social’.
Do not tick Hindu, Christian, Muslim, etc. unless yours is a religious association.
(iv) Aims and objects: This heading has two parts. First you should give all the main aims
and objects of the NGO. Secondly, give the objects and specific programs for which foreign
contribution is to be accepted and used (See ‘aims and objectives’ under ‘FCRA Registration’
on page 65 for more on this).
(v) Governing Body: Details of all members of the Governing Body or Executive Council, etc.
should be given in the table.
The table has eight columns. In column 3, give the name of father / husband. If the member
is an office bearer (President, Secretary, etc.), then say this in column 6. If one of the members
is related to an office-bearer, then say this (brother, husband, wife of...) in column 7.
2. Convictions
Here the NGO has to provide details of convictions, etc. These should relate to one of the
members of Governing body listed in the previous table. Moreover, these convictions should be
related to their official duties or on a criminal charge. This means that if a person is convicted
for a traffic offense while going for a wedding, it need not be listed here.
This information is to be given where:
" A conviction has been made by a court;
" A conviction has not been made, but prosecution for some legal case has been launched; or
" The person has diverted or mis-utilised funds of this NGO or of any other NGO in the past.
3. Branch or Associate
Sometimes foreign NGOs or Agencies set up a branch office in India. Clause (a) asks for
details of their parent organization. Similarly, your NGO may have a sister NGO that already
has FCRA registration. If yes, then you should give details of such sister NGO here.
Clause (b) applies if your NGO had FCRA registration earlier but this has been canceled due
to some violation.
Clause (c) applies if your NGO has been asked [under section 10(b)] to get prior- permission
for each grant.
4. FCRA Registration
There are two clauses here. You may have applied earlier for FCRA registration. Give information
about this under clause (i).
Clause (ii) is a little more complicated. Your NGO may have close links with another NGO (or
its branch / unit), which has been refused FCRA registration. Or worse still, that NGO may have
been prohibited from accepting foreign funds. You are asked to give this information here.
5. Prior-permission
Past Record: You may have received foreign contribution earlier under prior permission. Details
of this should be given under 5(i)(a). Also give the date when you submitted the related FC-
3 and accounts.
59
Amount Utilised: If you have already received funds under prior-permission this year, then you
may not have filed FC-3 so far. You should then prepare a report showing amount received,
utilised (head-wise) and the unspent balance. This should be attached to form FC-1A.
Previous Violations: On the other hand, you may have accepted foreign contribution earlier
without legal permission (by channeling, shadow-lending, legal holder, etc.). If you have, then
give full details here.
Remember that under the law you can get up to five years in prison for this!
6. Newspapers
Is your NGO bringing out a newsletter? If yes, check whether it has been registered under
Press and Registration of Books Act, 1867 (PRBA). If yes, then see whether it is registered
as a ‘newspaper’. If it is registered as a ‘newspaper’, then give details of registration here. For
more on this, see ‘Newspapers’ under ‘FCRA Registration’ on page 66.
Often annual reports contain statement of thanks to individuals and collaborating NGOs. Some
of these may mislead the FCRA department into thinking that you have received foreign
contribution illegally. Therefore, review the report carefully, and clarify this where necessary.
Accounts: A copy of the audited Balance Sheet, Income and Expenditure, and Receipts and
Payments Account should also be given for last three years.
How will you use this money or materials? Give the purpose and the geographical area as well.
Please be specific as to the districts to be covered. This is important if you are working in a
sensitive area.
Sometimes, a nodal agency or network makes the grant. In such case, you will be getting the
money from another FCRA holder. This information, if required, should be given at 8(iii). In this
case also, a copy of proposal and budget for your grant should be attached.
9. Bank Account
You have to open and use a bank account exclusively for foreign funds. Give details of this
FCRA bank account here. These details include account number, name and address of the
bank.
60
In case you are receiving the money from another FCRA holder in India, give information related
to that NGO only. There is no need to give details of the ultimate source.
If you are getting the money from an embassy or Government agency (e.g. USAID), then this
should be clarified under 10(c).
This certificate confirms that the NGO has been formed and registered. It also says that the
organisation is genuine and there is nothing against them. The area where the proposed project
will be implemented is also required.
The total recommended budget of the project and the name of the donor is also to be given
in the certificate.
The District Collector of the area can issue this certificate. Alternatively, you can get it from
the concerned Department of the State or Central Government.
Signing
The person whose name was given as applicant on first page4 should sign the application form.
This could be the chief functionary or an authorised office bearer. The rubber stamp of the
association must be put when you sign.
The form has to be signed at two places, both on the last page. Date of the form is to be given
at two places: on first page and again on the last page.
Copies
You should make two complete sets. But only one has to be sent to the FCRA. The other
should be kept on your office files.
4
See ‘Applicant’ on page 58
5
See ‘Amount Utilised’ on page 60
61
Send it to FCRA
You have to then send these to the Home Ministry at the following address:
You should send your papers by ‘Registered Post - Acknowledgement Due’. Retain the proof of
posting and acknowledgement card (when received back) carefully.
If you are having the form delivered by hand, make sure you get an acknowledgement, with
rubber stamp, date and signatures.
62
FCRA Registration6
FCRA Registration means registration under Foreign Contribution (Regulation) Act, 1976. This
is necessary, if an NGO wants to receive any funds, material, etc. from a ‘foreign source’.
How to register
In simple English, ‘registration’ means that your name is put on a list or a register. However,
FCRA registration is a little more complicated.
Filing FC-8
You should then fill up and file an application in form FC-8. Along with this form, you will have
to give several documents8 .
Scrutiny
The FCRA Department will review your application. If it is complete and satisfactory, FCRA will
ask the IB (Intelligence Bureau) for a report. Otherwise, they may ask you for additional details.
Acceptance
If the report is satisfactory, your application will be accepted and you will be issued a registration
certificate.
Registration Certificate
The certificate will show your FCRA registration number. Read the certificate carefully. It also
includes other important information regarding FCRA. A copy of the certificate also goes to your
bank.
6
Based on AccountAble 42: FCRA Registration
7
Open the account with minimum deposit (normally Rs.500). This money will remain in the account till the
bank account is kept open.
8
See ‘Form FC-8’ on page 150
63
Keep the certificate carefully. Laminate it if you wish. Also make extra xerox copies for donor
agencies, which ask for it.
Rejection
Your application can also be rejected under section 10. In that case, you will be asked to apply
for prior permission on a case-by-case basis.
Appeal
If your application is rejected, you can either decide to settle for prior-permission on a case-
by-case basis9 . Or you can appeal to the High Court in your state within 60 days [section 21(2)].
For counting sixty days, start from the date of the order, not the date on which you received
it.
Common Problems
FCRA registration is a long-drawn process. As there is only one central office at Delhi, follow-
up is quite a problem for most NGOs. Reportedly, there are some practical problems which
people face in getting FCRA registration.
9
See ‘Appeal against rejection’ under ‘Prior Permission’ on page 57.
64
Three years
The NGO should have been registered for at least three years before FCRA people will consider
their application.
No foreigners
If there are any foreigners on your Governing Board, your application is likely to be rejected.
No time frame
There is no time limit under the law on how long FCRA will take to process or register an NGO
under FCRA.
However, FCRA does not explain the reason for refusal of registration to the concerned NGO.
The NGO therefore remains in the dark.
Filling up FC-8
Form FC-8 has ten main headings and an undertaking. The entire form should be filled up in
CAPITAL letters:
1. Background
Start with writing the Chief Functionary’s name in the blank space (‘I,……..’). This means the
person who is directly responsible for day to day running of the NGO.
(i) Name and address: Give the name and postal address of the NGO. The LIB10 officers will
visit this office to make inquiries. This may be different from your registered office.
(ii) Registration details: Give details of your registration as a Society or a Trust here. Non-
profit companies also need to give these details. Unregistered NGOs can also apply but are not
likely to get FCRA registration.
(iii) Nature of Association: This depends on the work you plan to do. If your main work is
development, then you can just tick ‘social’.
Do not tick Hindu, Christian, Muslim, etc. unless yours is a religious association.
(iv) Aims and objects: This heading has two parts. First you should give all the main aims and
objects of the NGO. Secondly, you have to give the objects and specific programs for which
foreign contribution is to be accepted and used.
Under the first sub-heading, summarize the main objectives of your association. These can be
taken from the objects clause of your Memorandum of Association. A copy of the Memorandum
and Bylaws of Society should be attached.
Filling up the second part of this clause is not easy. It is difficult to say which specific program
you will be running 10 years from now. This becomes tricky because each year you have to
confirm (in form FC-3) that you have spent the foreign contribution only for the purpose for which
it was registered under FCRA.
(v) Governing Body: The Governing Body normally has two types of members. Some hold an
office (President, Secretary, etc.). These are called ‘office bearers’. Others do not hold any office
but are plain members of the Governing Body. Trustees are treated as office bearers.
10
Local Intelligence Bureau
65
Details of all the members of the Governing Body or Executive Council, etc. should be given
in the table. The table has eight columns. In column 3, give the name of father / husband. If
the member is an office bearer (President, Secretary, etc.), then say this in column 6. If one
of the members is related to an office-bearer, then say this (brother, husband, wife of…) in
column 7.
If the member is related to another member, then apparently there is no need to specify this
– though of course you may, if you wish.
2. Convictions
These convictions may relate to any of the members of Governing body listed in the previous
table. Moreover, these convictions should be connected to the performance of their official
duties or for any criminal offence.
3. Branch or Associate
Sometimes foreign NGOs or Agencies set up a branch office in India. This clause asks for
details of their parent organization.
Similarly, your NGO may have a sister NGO that already has FCRA registration. If yes, then
you should give details of such sister NGO here.
4. Prior-permission
Past Record: You may have received foreign contribution earlier under prior permission. Details
of this should be given under 4(i)(a). You should also give information on when you submitted
the related FC-3 and accounts.
Previous Violations: On the other hand, you may have accepted foreign contribution earlier
without legal permission (by channeling, shadow-lending, legal holder, etc.). If you have, then
give full details here.
Remember that under the law you can get up to five years in prison for this!
5. Newspapers
Is your NGO bringing out a newsletter? If yes, check whether it has been registered under
Press and Registration of Books Act, 1867 (PRBA). If yes, then whether it is registered as a
‘newspaper’. If it is registered as a ‘newspaper’, then give details of registration here.
Normally anyone who brings out a registered newspaper can not receive any foreign contribution
[section 4(1)(b)]. However, in 1987, the Government issued a notification relaxing this rule [F.
# 11/ 21022/ 14(5)87-FCRA-1 dtd. 4.8.87].
According to this notification, even NGOs who bring out publications that look like newspapers
can receive foreign contribution. In some cases, NGOs which have registered their publication
as ‘newspaper’, may also receive foreign contribution. There are two conditions for this exemption.
Firstly, the publication should not be a newspaper as defined in section 1(1) of the PRBA.
According to this, ‘a “newspaper” means any printed periodical work containing public news or
comments on public news’. This also means that under the law it should not be necessary to
66
register it under chapter VA of the PRBA. If this is true, then it does not matter that the
publication has already been registered as a ‘newspaper’ under PRBA.
To prove this, you have to get a certificate from the Registrar saying that the publication falls
in ‘category B’.
Secondly, you also need to give a declaration to the FCRA department signed by the chief
functionary. This declaration will have to be given each year (January-December), by 31st
January.
6. Earlier applications
If your NGO had applied earlier also for FCRA registration, then you should give the details
here. These would include date on which your application was filed and reference of the last
letter you received from FCRA.
If you have not received any letter or the application is still pending, then say this at 6(d). But
if you were refused registration earlier, then say so at 6(c).
Often annual reports contain statement of thanks to individuals and collaborating NGOs. Some
of these may mislead the FCRA into thinking that you have received foreign contribution
illegally. Therefore, review the report carefully, and clarify this where necessary.
Accounts: A copy of the audited Balance Sheet, Income and Expenditure, and Receipts and
Payments Account should also be given for last three years.
Area of Operation: This should preferably include names of states covered by you. If you are
operating in a large state or in a region which is politically disturbed, specify the districts you
are working in.
If you want, you can also give a note on socio-economic background of the region and
particularly the beneficiaries you are covering.
8. Politics
Is your NGO politically active or connected with a political party? Then the Government may
have issued a notification in the official gazette. This notification may say that your NGO is
an organization of a political nature, even though it is not a political party.
If this has happened, then give details of the notification here. Under section 5, such NGOs
can not be registered under FCRA but are given prior-permission on case by case basis.
9. Bank Account
Give details of the FCRA bank account here (see ‘FCRA Bank Account’ on page 63). These
details include account number, name and address of the bank.
67
10. Additional Information
You can give any additional relevant information here.
Undertaking
The revised undertaking is relevant only for those NGOs, which apply for FCRA registration in
the new form FC-8. It will not apply to those who had used the old form FC-8 (before 27-Dec-
1996) while registering.
There are three items here which you need to understand before signing the form:
(i) Changes in society: If you change the name, address, registration, nature, aims or objects
of the association at any time, you have to inform the FCRA within 30 days.
(ii) Changes in office bearers: The office bearers of the NGO specified in form FC-8 become
‘frozen’. This means that more than 50% of these office bearers11 should continue in office.
What happens if 50% or more of the office bearers change? You have to apply to FCRA for
approving the changes. This approval process may take 3-4 months or longer.
In the meanwhile, your FCRA registration will be suspended. You can not receive any foreign
contribution till the change is approved. For each grant you will have to apply for prior permission.
This clause has been introduced to prevent ‘sale’ of FCRA registered NGOs. However, it may
cause problems for other NGOs also.
To reduce the nuisance, try to expand your Governing Body before applying for FCRA. Consider
increasing the number of office bearers to 10 or 12. After all, cabinets often have more than
50 ministers!
(iii) Change in bank: If you change the FCRA bank or branch, you will have to apply to FCRA
for permission. This can be done on your letterhead. You will also need to give satisfactory
reasons for this change.
If you want to deliver the form personally, make sure you take an acknowledgement (with rubber
stamp and date) at the counter. Also phone up to check the visiting hours, which may change
from time to time.
11
For more on office-bearers see ‘Governing Body’ on page 65
68
Check-list of Documents to be attached
This form has been revised by Ministry of Home Affairs vide notification no. GSR 63 (E) and
published in The Gazette of India – dated 24th January 2000. This revision provides for
attaching a recommendation certificate with this form. All applications for registration filed after
24-1-2000 should be in this form. Attach the following documents (one copy each) to your
application in form FC-8:
! Certificate from concerned District Collector/ Department of State Government/ Ministry
or Department of Central Government
! Activity report for past three years (or annual reports for three years)
! Audited Statements of Account for past three years (Balance Sheet, Income and
Expenditure, Receipts and Payments Account along with audit report)
! List of states or districts you will be working in
! Note on socio-economic background of the beneficiaries and of the region to be covered
If you are bringing out a ‘registered newspaper’ (meaning that you have registered
your newsletter as a ‘newspaper’), then also attach:
! ‘Category B’ certificate issued by the Registrar of Newspapers
! Declaration12 in ‘Form X’ regarding newsletter
! A copy of the three latest issues of the newsletter
12
See ‘Declaration regarding newspaper/ newsletter’ on page 155
69
Basics of FC-313
What is FC-3
The Annual Return of Foreign Contribution
If a foreigner or foreign agency gives you any funds or material (including assets) as a grant,
it is known as ‘foreign contribution’.
Form FC-3 is a disclosure of all such grants. It also gives details of utilisation of such funds.
Due Date
Each year the form should be prepared for the period beginning 1st April to 31st March of
following year. The form should be posted early to reach FCRA Department by 31st July.
If you have received foreign funds after getting prior permission, you should continue filing FC-
3 till these funds are fully utilised.
Year
On top of the form, give the year for which the form is being filled. For example, in case of
year 2001-02, you will write “Account of foreign contribution of the year ending on 31st March
2002”.
13
Based on AccountAble 20: Filling Up Form FC-3 – Basics
70
Item (ii): FCRA Registration
Fill the FCRA registration number and the date of registration at the top. This information is
taken from the FCRA registration certificate.
Give the number and date of FCRA’s prior permission letter for this grant. If you have received
more than one grant during the year under two separate prior permission letters, give reference
of both the letters.
The table given under this heading has five main sections (columns):
! Purpose (column 2)
! Previous Balance (columns 3 – 4)
! Details of Receipts (columns 5 – 9)
! Utilisation (columns 10 – 11)
! Unspent Balance (columns 12 – 13)
14
Physical items or material
71
Column 2: Purpose
This column gives a list of 56 ‘purposes’ for which the money may have been received and
utilised. The last purpose (56th) is for activities, which may not be covered by the other 55.
You will find these balances in your FC-3 of the previous year. If you do not have any opening
balance under a particular item, just say ‘Nil’.
Columns 5 to 9: Receipts
This section has several columns. There are three main sub-sections: ‘As first recipient’, ‘As
second / subsequent recipient’ and ‘Total’.
First Recipient
For each receipt, check whether you have received it directly from the foreign donor or not. If
yes, you will be known as ‘first recipient’. You will then show the particular receipt in the ‘first
recipient’ columns.
Second Recipient
If you have received your funds through another FCRA registered NGO, then you become a
‘second / subsequent recipient’. You should then show this receipt in the columns for ‘second
recipient’.
72
Columns 10 and 11: Amount Utilised
The funds utilised during the year should be shown in column 10. Pick up the figures from your
FCRA Receipts and Payments Account.
If you have received materials15 also, show the utilisation of these items in column 11 as utilised
in kind.
Some Indian Agencies like CAPART or CRY may also give you funds from their FCRA account.
In such a case, their grant should also be listed here.
Name and address of the donor should be written in column 3. Purpose of each grant is to be
given in column 4.
Each installment from the donor agency is to be listed separately along with purpose, date and
amount.
Second Recipient
If you received funds as second recipient, these grants also have to be listed here. In such
a case, give the name and address of the Indian agency / NGO through whom you have
received the funds. Particulars of the original donor do not have to be given.
15
You have to maintain FC-6 for these. See ‘Maintaining Form FC-6’ on page 84.
16
Section 6 (1)(b), rule 8(1)(b)
17
For practical reasons, you may need to open another bank account in the field area (and transfer FCRA
funds) for use over there. FCRA law does not allow this. However, in practice, sometimes FCRA authorities
do not object to this if the reasons are genuine.
73
(ii) Large Individual Donors
If you have received funds/ material which add up to more than Rs.1 Lakh in a year from an
individual (person) donor, then you should list such donors here. Name and address of such
donors should be given in column 3.
In this case also, all installments should be listed separately. Give purpose, date and amount
under columns 4, 5 and 6.
Declaration
The form has to be signed only at one place (i.e. under the declaration statement) by the Chief
Functionary. The seal (rubber stamp) of the NGO should also be put.
CA Certificate
This certificate should be given by a Chartered Accountant (preferably your auditor). He/she
should indicate his/her name, address and registration number. He/she should also put the seal
of his/her firm on the form. The same person should also sign the FCRA Receipts and Payments
Account and FCRA Balance Sheet in the same manner.
FC-3 Annexures
Under rule 8 (2), the two accounting statements should be annexed to the form FC-3. These
are: FCRA Receipts and Payments Account, and the FCRA Balance Sheet. Again at least three
copies should be obtained – two for dispatch to the FCRA authorities along with FC-3, and one
for the office record. Make extra photocopies for dispatch to the funding agencies.
18
Only if the Indian office of the Donor is not registered under FCRA
74
Intricacies of FC-319
Opening Items
Address
In most cases, you should give the address of your registered office in FC-3. This should be
done even if the registered office is merely an address of convenience and the main office is
else where in the city/ state.
However, in some cases, the FCRA account is transferred to another state. For example, your
registered office may be in Delhi and your FCRA account may have been shifted to Orissa20 .
In such a case, you should give the address that is given in the revised FC-821 .
Similarly, if you have shifted your office within the city or state, you would have sent a letter
to FCRA department regarding the new address22. When filling up FC-3, you should use this
new address only.
Summary of Interest
Under this head, all interest earned through the FCRA Balance Sheet should be shown. This
interest income should be taken into FCRA Receipts and Payments Account. Interest earned
on endowments, corpus, micro-credit loans, fixed deposits, savings bank account, etc. can also
be shown here.
Remember, that this is merely a summary of the interest earned. The receipt and utilization of
interest should also be shown in table 2 and again in tables 423 and 524 .
Receipts in Kind
‘Receipts in kind’ are different from assets purchased by your organisation out of foreign funds.
These are items (goods, materials, etc.) donated or given at a nominal price by a foreign
source. These are treated as foreign contribution26. These should be reported in columns 6 or
8 of table 2.
19
Based on AccountAble 72-73: Intricacies of FC-3
20
This is done after approval by FCRA authorities and filling of fresh FC-8
21
Filed with FCRA department at the time of shifting of FCRA account
22
See ‘Undertaking’ in form FC-8
23.
Donor-wise Receipt of foreign contribution
24
Country-wise Receipt of foreign contribution
25
Section 2(1)(c) does not make any distinction between grant and loans funds – both are treated as
foreign contribution
26
Section 2(1)(c)(i)
75
Valuation
How should these be valued? The valuation does not have to be very accurate. You can give
estimated values, which are reasonably fair. You can also talk to the donor and find out
approximate landed price in India. Or you can find out the value from insurance documents. In
some cases, you may have received a Proforma invoice also.
FC-6
The items and figures (for materials) that you report in the FC-3 should tie up with your FC-
6 as well. Remember that FC-6 is like a stock record and this should not be filed with the
FCRA27 .
Interest
Bank Interest
Some donor agencies ask for accounting of interest earned on their funds lying in the bank
account. Such interest can be shown as addition to their funds in column seven of the relevant
row. This refers to the row where their main project funds are shown such as ‘rural development’
or ‘animal husbandry’, etc.
However, some agencies do not insist on allocation of interest to their project. Some bank
interest, therefore, remain surplus. Such unallocated28 bank interest can be shown under item
‘56: Other Activities’.
27
See ‘Maintaining form FC-6’ on page 84 for more on this.
28
Interest that has not been allocated to particular grant making agency.
76
Revolving Fund Interest
This includes interest and service charges, etc. on micro–credit loans. This income can be
shown under item ‘56: Other Activities’, under the sub heading ‘interest / service charges on
revolving fund’. You can use column seven for this.
Any interest paid out on revolving fund capital can be shown in the column ten (utilisation) of
the same row.
Corpus Interest
This interest income would come from investments made out of Corpus/ Endowment Fund. This
can be shown in column seven item 55 (i) (a) ‘Establishment of Corpus Fund’.
Alternatively, you can show this income under item ‘56: Other Activities’ as ‘interest on corpus
/ endowment investments’.
It will be useful to give a footnote showing the nature of this income in the FC-3.
Second Recipient
In some cases, the funding agency’s Indian office may be registered in India under FCRA (e.g.
Actionaid). You should then show receipts from such agencies in the ‘second recipient’ columns
(7 and 8).
Non-earmarked Donations
Any foreign donations that are received in cash should also be shown here. Such donations are
often not earmarked by the donor for any particular activity. These should be shown under
‘miscellaneous’ category (item ‘56: Other Activities’).
Sale of Assets
With the donor’s consent, you can sell FCRA assets to any one (whether they have FCRA or
not).
If you sell off any asset (purchased earlier with foreign funds), then show the amount received
as sale price here. This can be shown under the activity for which the asset was originally
received (such as ‘rural development’).
Level of Detail
How much detail should be given in FC-3 or FCRA Receipts and Payments Account? This
depends on the amount of total funds involved and the nature of programmes. For instance,
if utilisation of a crore of Rupees is shown in one line as ‘rural development’, then the purpose
of reporting is not met29 .
Your auditors should be able to guide in this. However, in general you should try to break down
the figures so that each line item is not more than 5% of total receipts or Rs.1 lakh, whichever
is higher.
29
In such cases, FCRA department often issues show cause notice or makes a field visit.
77
For example, if your total receipts are Rs.10 lakhs, then you should try to break down individual
line items to Rs.1 lakh or lower. However, if your total receipts are Rs.2 crores, then you can
show individual line items up to ten lakhs each.
Unutilised balances
In Cash
For working out the unutilised cash balance, look at the chart below:
3 5 7 10 12
In Kind
Similarly for working out the balances in kind, add up column 4, column 6 and column 8. From
this deduct column 11.
4 6 8 11 13
You have to do the above exercise for each row and write the figures in the last column (column
12 or 13: Balance in cash or kind, as the case may be).
Clearly the intention of FCRA law is to avoid mixing of funds. Following this opening, many
NGOs frequently borrow / lend money to the Indian section. This happens when FCRA funds
are delayed but the project has to continue.
Whether this is legal or not is separate issue. Our suggestion here is limited only to the
accounting and disclosure aspects. Such loans can be shown in the Receipts and Payments
78
Account and Balance Sheet as below:
FCRA Receipts and Payments Account (partial) FCRA Balance Sheet (partial)
Receipts Payments Liabilities Assets
Loan from Grant receivable 2,000
Grant received 90,000 Project Expenditure 92,000
Indian section 4,500 FCRA bank
Loan from Ind- Loan returned to
Account 22,500
ian section 10,000 Indian section 6,000
Bank Details
For practical reasons, you may need to open another bank account in the field area (and
transfer FCRA funds) for use over there. The position regarding this practice is not very clear.
Sometimes FCRA authorities do not object to this if the reasons are genuine.
In case of Rupee collections, you can think of treating 50% as foreign contribution and balance
50% as Indian. While there is no circular or guideline on this, this appears to be the only logical
option.
All foreign collections should be lumped together and shown as one entry in the table under
‘individual donors below 1 lakh’. In such case the purpose shown (in column 4) can be your
organisation’s main purpose (e.g. ‘18. Help for poor, aged or destitute’ or ‘24. Welfare of women
and children’).
Sl. No. Institutional/ Name and Address Purpose Date and Month Amount
Individual/ of Receipt in Rs.
Other Donors
1 – – Schools – 3,25,251
2 – – Gaushala – 2,67,762
3 – – Corpus – 1,50,675
Total 7,43,688
79
More on Individual Donors
These donors may be sending you money by cheque or in cash (when they visit you). You
should note down their names and addresses while issuing a receipt. If possible (and without
offending the donor), also take down the passport number, country of issue30 and expiry date.
Reconciliation
Tables 2 and 4
Add up all the cash and cheque grants / donations listed in Table 4. These should be the same
as grant receipts (in money terms) shown in the FCRA Receipts and Payments Account.
Crosscheck the total receipts (including materials grants, with the total receipts shown in
column 9 of Table 2 also).
However, you may find a small difference in these two figures. This may be because some
inflows can not be classified under any of the three donor categories. The earlier category of
‘others’ has now been deleted.
The resulting figure should tally with the un-utilised amount in column 12. If you wish you can
attach a copy of this calculation to your FC-3.
30
Needed to fill up the country chart
80
Table 2: Cross-check Balance in Kind
Similarly the unutilised balance in kind (total of column 13) should be cross-checked with the
total balances shown in FC-6 register.
For this, prepare a summary of FC-6 sheets showing the balance on 31st March. Add this up.
This should tally with total of column 13.
Closing Items
Signing FCRA Accounts
The FCRA Receipts and Payment Account and Balance Sheet have to be attached to FC-3.
1. Balance Sheet
This should show position of accounts as at 31st March. It should be prepared from accounts
maintained for FCRA.
A practising Chartered Accountant should sign both. He / she would put the firm’s seal, name
and signatures under a suitable audit statement. Normally, the audit statement would be “As
per our separate report of even date in Form FC-3 attached”.
CA Certificate
The auditor also has to certify the figures of opening balance, receipts during the year and
closing balances. These figures appear in the certificate at end of form FC-3. The opening
balance should be taken from the previous FC-3. Receipts during the year include currency31
as well as material32 . These three figures should also match table 2 as follows:
Brought forward – at the beginning of the year Total of columns three and four
The certificate can be typed on plain paper. However, it would be better, if the certificate is
issued by the auditor on their firm’s letterhead. The auditor is also free to give any clarificatory
notes or qualification in the certificate.
Accounting Standards
If the NGO has any income generation project33 , then the following Accounting Standards
should be considered when preparing FCRA accounts34:
31
Taken from Receipts & Payments Account
32
Taken from FC-6
33
Refer ICAI clarification titled ‘Accounting Standards for NGOs’; The Chartered Accountant, Sep-95,
Page 79.
34
Receipts & Payments Account and Balance Sheet
81
AS Title Effective Date
AS-4 Contingencies and events occurring after the Balance Sheet Date 1-Apr-95
AS-5 Net Profit or Loss for the period, Prior Period Items and changes
in Accounting Policies 1-Apr-96
Proof of posting
Keep the proof of posting (Post Office receipt) carefully on file. This comes in useful if you
receive a letter from FCRA for non-filing of return.
Copy to Donors
After filing the form FC-3, send a copy (with Balance Sheet and Receipts and Payments and
other Annexures) to your Funding Agency’s local office, according to their reporting requirements.
35
See item 8 under heading ‘Offenses and Penalties: Ready-Reckoner’ on page 95.
36
Only about 70% NGOs file FC-3 regularly.
82
Concealing Information
FCRA department has now added a warning at the end of the table in Heading 2. Read this
carefully before you sign the form FC-3 – any concealment or falsification may prompt the
Department to initiate ‘appropriate action’.
While the Department does not say here what ‘appropriate action’ can be taken, this includes
suspension / cancellation of registration, fine and jail37 .
37
See item 9 under heading ‘Offenses and Penalties: Ready-Reckoner’ on page 95
38
Balance Sheet and Receipts & Payments Account should also be attached.
83
Maintaining Form FC-639
Foreign Contribution
Foreign contribution can be in cash or cheque. For this, you maintain a cash book and ledger.
Foreign contribution can also be given as physical articles40 . This is known as ‘foreign contribution
in kind’. Examples are blankets, food, boats, plastic sheets, etc. You can not record these in
cash book or ledger. Therefore, FCRA rules say that you should maintain a separate stock
register for these [rule 8(1)(a)].
What is FC-6
The format for this stock register is called FC-6. This shows all foreign contribution received
as articles and distributed by an NGO.
Every NGO that receives and handles foreign contribution in kind should maintain form FC-6.
You will have to xerox or print 50-200 copies of the form. After this, the sheets can be bound
to make a register.
How do we maintain it
The step-by-step procedure is given on page 85. But first let us understand some main issues:
39
Based on AccountAble 58: Maintaining FC-6
40
Section 2(1)(c)(i)
84
What if some of the stuff has to be sold…
Sometimes the material can not be used by the people directly. In such case, the NGO may
sell the material. The money collected from the sale becomes FCRA money. This sale should
be recorded in FC-6.
It is only personal gifts below Rs.1,000 each that fall under exemption of section 2(1)(c)(i).
Only the information extracted from this should be entered in FC-3. The FC-3 is later filed with
the FCRA Department.
Step-by-step procedure
The following explains how stock register in form FC-6 should be maintained:
Description of Article
Start with a fresh sheet for each type of item. Remember to open different sheets for different
size / packing of the same item.
Write the name of the article on top. For example, ‘Blankets – large size’ or ‘Cooking Oil – 200
ml. Tins’. If you also receive Cooking oil in 500 ml tins, open a separate account for these.
Receipts
Numbers refer to column numbers in the form. Enter each transaction separately, in separate
lines.
1. Date
Date on which you received the consignment.
2. Donor
Who sent you these items? Give the name and address of the donor here. If you received the
items through another NGO, just give the name and address of that NGO.
3. Mode
How did the items reach you? This could be by road, rail or in some cases by air. Write the
mode here – also give truck / train number, if feasible. In case of some small items, the donor
may have just given these to you by hand also. In this case, the mode will be ‘by hand’.
4. Purpose
Why have these items been sent to you? For distribution among people? For use at your office
(e.g. a vehicle). Write the purpose of this donation here.
85
5. Quantity
The number of units (tins, blankets, etc.) received. If you received 200 tins of 200 ml. each,
write 200 tins. Do not write 40 litres.
This can be tricky. For example, you have received 4 truck-loads of wheat. Each truck had 1
tonne of wheat. That means 4,000 Kgs of wheat. You are going to give each family 1 kilogram
(kg). What should you do?
In this case, you should keep the unit as KGs. Say this on top, where you write description
of the item. Then write 4,000 in the quantity column (column # 5).
6. Approximate Value
Here you have to write the value of the items received. This does not have to be accurate –
a near-about value is good enough.
You can get this from the documents (Bill of lading, shipping declaration, insurance papers,
etc.). Or you could ask the donor to give you a rough figure. If it is an item available in the
local market, you can also use this price as the basis.
7. Intimation
This column is slightly confusing. No separate intimation should be sent to the Government.
What you have to give is the date of mailing FC-3.
However, the FC-3 will be filed after the end of the year. So leave the column blank now. Fill
it up after you have sent the FC-3 to the FCRA Department.
Utilisation
Each issue of items should be recorded in a separate line.
8. Date
Date of issue should be given here.
86
9. Beneficiary
Who received the items that were issued? In most cases, this would be a beneficiary. His /
her name and address should be given. Each beneficiary should be listed separately, in one
row.
Sometimes, the items are issued to another NGO. This NGO will then distribute the items in
their area. If so, give the name and address of the NGO here.
In some cases, the items are sold. In such a case, write the name and address of the person
who bought these items.
10. Purpose
If the items are sold, then there is no need to write any purpose. In other cases, you should
give the purpose. In case of food items, the purpose will mostly be ‘relief’. In case of construction
items, it could be ‘rehabilitation’.
If the items were issued to another NGO, the purpose could be redistribution.
Damages: If some of the items were damaged or pilfered, then these should also be entered
here.
Totals: At the end of the year, total up column 11. Work out a rupee value for this. Use the
same basis for valuation as in column 6.
Linking to FC-3: Enter the final value in column 11 of FC-3. You will need to select a suitable
purpose in FC-3. For example, this could be ‘5. Rural Development’ or ‘23. Relief for natural
calamities’.
If the items were used for mixed purposes, you can split the value and show it in several
different rows in form FC-3.
13. Transferred
If these were returned to donor or given to another NGO, enter the quantity in this column.
Here you have to give reference of the FCRA cash book page and date on which this recovery
is shown.
87
Declaration and Signature
Each filled up sheet of form FC-6 should be signed at the end of the year. However, the rules
do not say who should sign the declaration. Therefore, the chief functionary or an equally
responsible person can sign it.
Auditing FC-6
Should the auditors check FC-6 also? Yes:
" Clause (iv) of the certificate given by the auditors covers all records maintained under rule
8(1) of FCRA. These include the FCRA cash book, ledger, and registers in form FC-6 and
form FC-741.
" The figures of foreign contribution (received and utilised) also include value of FC-6 items.
41
Used to maintain records of foreign contribution recieved in the form of foreign secuities (shares, bonds,
debentures, etc.)
88
FCRA Fellowships42
Fellowships are common in the development sector. Quite often these are funded from FCRA
grants. However, in most cases, the Agencies and the individuals concerned are not aware that
certain FCRA formalities are required. Here we deal with the FCRA implications of a fellowship
grant.
In the development sector, fellowship generally means a regular payment to an individual for
some research or study. The topic of the study is clearly defined. Some sort of output (a report
or a book) is also expected at the end of the study. Normally, the work is that it can be done
by one person — an organization is not required for the work.
However, requirements of FCRA apply equally to all similar payments (made to an Indian
citizen), including scholarships and stipend.
42
Based on AccountAble 35: FCRA Fellowships
89
! either the entire air fare may be included in the fellowship; or,
! the net difference between economy and first class may be added.
This will depend on the facts of the case and the person interpreting the law.
Splitting Hairs
The word ‘fellowship’ has not been defined or used in FCRA, which uses the words ‘scholarship’
or ‘stipend’. Even these two words have not been defined in the Act.
Fellowship: Webster 4.a: the position of a fellow (as of a university) b: the funds granted to
a fellow; Oxford 3: income of a fellow of a college or society.
Scholarship: Webster 1: the financial aid given to a student (as by a college or foundation) to
assist in the cost of education; Oxford 2: financial award for a student, etc. given for scholarly
achievement.
Stipend: Webster: a fixed sum of money paid periodically for services or to defray expenses;
Oxford: salary, especially of a clergyman.
An Indian Agency or NGO, which does not have FCRA or prior permission, should not receive
or disburse any FCRA amount for fellowship.
No permission or registration
No FCRA registration or prior permission is required for giving or accepting a fellowship,
scholarship or stipend to an individual. However, if this provision is wrongly interpreted to make
program grants to an organization as fellowship payments to its workers, you may attract
prosecution.
Prohibited
Fellowship, scholarship or stipend can not be paid from FCRA funds (section 4) to:
! Election candidates
! Employees of a Government corporation or Government Company
! Accredited journalists
! MPs, MLAs, etc.
! Judges
! Office bearers of political parties
! Government servants
43
See ‘13. When do FC funds become Indian’ on page 117.
90
Some exceptions to this are provided in section 10. These cover ordinary business payments
received by newspapers, etc. from foreign sources. These exceptions should be interpreted very
carefully.
Journalists
If you are making any payments to a journalist, check whether the person works with a
registered newspaper. If yes, it would be better to avoid the payment. Freelance journalists are
not covered by the prohibition, so long as they do not write a regular column or have correspondent
status for a registered newspaper or magazine.
Academic year is not defined in the Act. This will vary from one university to another. In other
cases, the period of fellowship is specified in the sanction letter and this may be treated as
an academic year.
Filling up FC-5
Personal details (1-7): Give your (receiver’s) personal details here. These include your passport
particulars (number, date and place of issue, valid till), if you have one. Also give details of
your occupation or profession.
Agency details (8): Give the particulars of the granting Agency here. When finalizing your
fellowship, make sure you have obtained information required for completing this item.
Fellowship details (9-11): Full particulars of the fellowship (amount, break-up, etc.) as also
mode or channel (cash, bank, etc.) should be given here. If the fellowship will be received in
equal installments, give the amount of installment and the frequency.
You also need to clearly state the purpose of the fellowship. Try to be as specific as possible.
If you will be attending any courses, then specify these also.
If you will have to go abroad as part of fellowship, then give the duration and dates of your
stay abroad.
Other information (12): If there is any special information, then it should be given here.
Otherwise it is not necessary to fill up this column.
44
See ‘Valuing the Fellowship’ on page 89.
91
When and Where
FC-5 should be filed within 30 days of receiving the payment. If the receiver is staying abroad,
this limit is extended to 60 days.
If the fellowship payments are going to be in equal installments (monthly, quarterly, etc.), then
you need to file the form FC-5 once only. Simply specify the frequency and amount of installments.
92
FCRA Penalties45
Most of us violate some law or the other at some point of time. We may do this knowingly or
unknowingly. But ignorance of law is not an excuse.
FCRA contains many penalties. We have ignored these all along because very few people have
been penalized under FCRA. Our thinking on this may be similar to those company directors
who had to go behind the bars under FERA in late 90’s.
This is a small attempt to identify the many landmines that are hidden in FCRA. Walk with care
lest you step on one.
Yet the letter of the law remains important. We need to know what is the worst that can happen.
Another thing to remember is that FCRA (Foreign Contribution Regulation Act, 1976) is not a
fiscal act. It is an Act to preserve internal security. This means that the style and procedure
of enforcement is different.
Various offenses and their penalties are listed in a ready-reckoner on next three pages. It may
be good idea to check the ready-reckoner before embarking on an adventure with FCRA.
2. Appeal against prohibition or refusal: If you are prohibited from receiving foreign contribution
or permission/ registration is refused, you can appeal within sixty days of order date. The appeal
has to be made to the High Court [sec. 21].
3. Chief Functionaries: Assume that the violation is done by a company or society. Who will
be penalized? Firstly the company/ society itself will be penalized. Secondly, anyone who was
in charge of the company / society (Chief Functionary/ director, etc.). However, if this person
can show that he did not know about this or it happened despite his best effort, then he / she
will not be penalized [sec. 26].
4. Governing body: In 3 above, can anyone else be penalized? Any director, member of
Governing body, manager, secretary or other officer can also be penalized. However, in this case,
it must be shown that there was neglect or connivance or consent of such person [sec. 26].
5. Advisers and Funding Agencies: The Government can prosecute any one who assists an
organization in receiving foreign contribution (in violation of FCRA). This may include Governing
Body members, advisers, consultants, funding agency officers, etc. if their role is proven [sec.
23].
6. Government’s sanction: No one can be punished or fined under FCRA unless the Government
first sanctions prosecution. This means that there can not be any public-interest petition under
FCRA [sec. 27].
45
Based on AccountAble 29: FCRA Penalties
93
8. Honest mistake: When the Government is acting under FCRA, it may make an honest
mistake and cause loss or damage. For this loss or damage, no one can prosecute the
Government [sec. 29].
1. Politician/ journalist/ judge/ " Person who " Seizure and confiscation
Government servant/ public accepted the of foreign contribution [sec. 16, 18]
sector employee accepts foreign contribution " Additional fine (upto five times in
foreign contribution " Person who assisted value) if original foreign contribution
(section 4) spent [sec. 24]
" Imprisonment upto five years and/
or fine [sec. 23]
2. Political organization " Person who assisted " Seizure and confiscation
accepts foreign contribution of foreign contribution [sec. 16, 18]
without Government’s prior " Additional fine (upto five times in
permission (section 5) value) if original foreign contribution
spent [sec. 24]
" Imprisonment upto five years and/
or fine [sec. 23]
3. Indian resident or Indian " Indian resident or " Seizure and confiscation of
Citizen accepts foreign contri- Indian Citizen who foreign contribution [sec. 16, 18]
bution (currency) for above accepted " Additional fine (upto five times in
persons (section 4, 5) " Person who assisted value) if original foreign contribution
spent [sec. 24]
" Imprisonment upto five years and/
or fine [sec. 23]
4. Indian resident or Indian " Indian resident or " Seizure and confiscation of foreign
Citizen is involved in deliv- Indian Citizen who contribution [sec. 16, 18]
ery of foreign contribution was involved in " Additional fine (upto five times in
(currency) to above persons delivery value) if original foreign contribution
(section 4, 5) " Person who assisted spent [sec. 24]
" Imprisonment upto five years and/
or fine [sec. 23, 25]
5. Person after receiving " Person who received " Seizure and confiscation of
foreign contribution the currency foreign contribution [sec. 16, 18]
(currency) for one " Person who assisted " Additional fine (upto five times in
association delivers value) if original foreign contribution
it to different association spent [sec. 24]
(section 4) " Imprisonment upto five years and/
or fine [sec. 23, 25]
6. Association accepts foreign " Association " Seizure and confiscation of foreign
contribution without registration " Chief Functionary, etc. contribution [sec. 16, 18]
or prior permission (section 6) " Governing Body " Additional fine (upto five times in
members value) if original foreign contribution
" Other officers spent [sec. 24]
" Person who assisted " Imprisonment upto five years and/
or fine [sec. 23]
94
Offense Who may be penalized Penalty
10. Person nominated for election " Concerned person " Seizure and confiscation of
within 180 days of accepting foreign contribution [sec. 16, 18]
foreign contribution fails to " Additional fine (upto five times in
intimate Central Government value) if original foreign contribution
(section 6) spent [sec. 24]
" Imprisonment upto one year and
/ or fine upto Rs.1,000 [sec. 25]
11. Indian citizen receiving " Concerned person " Seizure and confiscation of
scholarship, stipend or similar foreign contribution [sec. 16, 18]
payment (exceeding Rs.36,000 " Additional fine (upto five times in
in academic year) fails to file value) if original foreign contribution
form FC-5 spent [sec. 24]
" Imprisonment upto one year and /
or fine upto Rs.1,000 [sec. 25]
12. Politician/ journalist/ judge/ " Person who accepted " Seizure and confiscation of foreign
Government servant/ public the gift contribution [sec. 16, 18]
sector employee accepted " Additional fine (upto five times in
95
Offense Who may be penalized Penalty
13. Politician/ journalist/ judge/ " Person who accepted " Seizure and confiscation of foreign
Government servant/ public the gift contribution [sec. 16, 18]
sector employee who " Additional fine (upto five times in
accepted foreign contribution value) if original foreign contribution
upto Rs.8,000 (as gift) from spent [sec. 24]
relative and did not give intim- " Imprisonment upto one year and /
ation to Government or fine upto Rs.1,000 [sec. 25]
(section 8)
14. Politician/ journalist/ judge/ " Person who accepted " Imprisonment upto three years and/
Government servant/ public the foreign hospitality or fine [sec. 23]
sector employee accepts
foreign hospitality without
medical emergency
[sec. 9]
15. Politician/ journalist/ judge/ " Person who accepted " Imprisonment upto one year and
Government servant/ public the foreign hospitality / or fine upto Rs.1,000 [sec. 25]
sector employee accepts
foreign hospitality in medical
emergency and does not
give intimation in 30 days
[sec. 9]
16. Association with FCRA " Association " Inspection and seizure of accounts
registration or prior perm- " Chief Functionary, etc. and records [sec. 14, 15]
ission does not maintain " Governing Body " Seizure and confiscation of foreign
prescribed records and members contribution [sec. 16, 18]
accounts [section 13] " Other officers " Additional fine (upto five times in
value) if original foreign contribution
spent [sec. 24]
" Imprisonment upto one year and /
or fine upto Rs.1,000 [sec. 25]
17. Person transfers/ deals with " Person who transf- " Seizure and confiscation of foreign
foreign contribution despite erred or dealt contribution [sec. 16, 18]
prohibitive order under " Person who assisted " Additional fine (upto five times in
section 12 [sec. 22] value) if original foreign contribution
spent [sec. 24]
" Imprisonment upto three years and/
or fine upto market value of foreign
contribution [sec. 22]
18. Accepting or assisting ano- " Person who accepts " Seizure and confiscation of for
ther person to accept " Person who assists eign contribution [sec. 16, 18]
foreign contribution in another to accept " Imprisonment upto five years and/
violation of FCRA [sec. 23] or fine [sec. 23]
96
Offense Who may be penalized Penalty
19. A person is convicted second " Association " Prohibition on accepting foreign
time for offense under sec. 23 " Person contribution for three years
(1) or 25 [sec. 25 A] [sec. 25 A]
97
98
Section III: Intricacies
The word ‘intricate’ comes from the English word ‘trick’. Intricacies are, therefore, the tricks that
the law plays on you. Of course, the law itself becomes trickier as time passes, learning
lessons from all the tricks that we play on it!
This section is for advanced readers. It tries to go into the nitty-gritty of the law as also
understanding the intention of the law. As the overall design of the Act becomes clearer, it may
be easier for us to see whether a particular way of looking at it may be right or not.
The first chapter offers an overview of sorts. The next three deal with specific points on which
confusion exists or where a provision of the Act causes difficulties. There is a general expectation
that a new FCRA law will be passed soon – let us see whether the new Act will resolve these
issues or cause further complications.
At this point, it is also worthwhile to quote from Khalil Gibran’s ‘The Prophet’:
And he answered:
You delight in laying down laws,
But while you build your sand-towers, the ocean brings more sand
to the shore,
And when you destroy them the ocean laughs with you.
But what of those to whom life is rock, and the law a chisel with
which they would carve it in their own likeness?…
What of the ox who loves his yoke and deems the elk and deer of
the forest stray and vagrant things?…
And of him who comes early to the wedding-feast, and when over-
fed and tired goes his way saying that all feasts are violation and
all feasters law-breakers?…
What shall I say of these save that they too stand in the sunlight,
but with their backs to the sun?
They see only their shadows, and their shadows are their laws….”
99
100
Understanding FCRA
Foreign Contribution (Regulation) Act, 1976 is a very short Act. However, there is an enormous
amount of confusion about its provisions. Also, there is very little literature on the law itself.
Most of the available material relates to practical procedures only.
In these paragraphs, we have tried to put down some of the understanding of FCRA law that
we have gained over the years.
Foreign Source
Foreign source is defined in section 2(1)(e). However, the definition is an ‘inclusive’ definition1 .
This means that the list provided in section 2(1)(e) is not complete or exhaustive.
This is a very important feature. Suppose there is a source ‘xyz’ which appears to be foreign,
based on common sense. However, it is not listed in section 2(1)(e). How will ‘xyz’ be treated?
It will be treated as a foreign source. Why? Because the definition is not exhaustive. It allows
the courts to treat other sources also as foreign.
There are five main categories listed in the ten clauses of this section. Going through these,
you get the sense that anything under foreign control may be a foreign source. These categories
are discussed below:
1. Individuals
How do you know whether a person is foreign or not? This is based on his or her citizenship2 .
The country of stay is not important.
This means that a foreigner staying in India, working in India, earning money in India, will still
remain a foreign source. On the other hand, an Indian working abroad, getting salary from a
foreign company, will not be a foreign source. An example of this category is Mr. Amartya Sen.
On the other hand, if a foreigner acquires Indian citizenship, then he or she will become an
Indian source. Similarly, if an Indian becomes a foreign citizen, then he or she will become a
foreign source.
However, the term NRI is sometimes used very casually. Therefore, it is best to confirm this
by asking whether the person has become a foreign citizen. If the answer is ‘no’, then the funds
will be treated as Indian.
1
It uses the word ‘includes’ instead of ‘means’.
2
Sec. 2(1)(e)(x). India does not recognize dual citizenship. An Indian who acquires foreign citizenship
promptly loses his or her Indian citizenship.
101
Shri Naipaul is eligible to apply under the Indian Government’s PIO Card scheme. If he applies
and gets this card3, then he will get some extra facilities, such as visa-free travel to India.
However, he will not get any political rights, such as right to vote in India.
Persons of Indian origin are treated as a foreign source. It does not matter whether they hold
the PIO card or not.
c. Dual Citizenship
The Government is now also seriously talking about dual-citizenship. This means that an Indian
can remain an Indian citizen, even though he or she becomes a foreign citizen.
Will this make a difference so far as FCRA is concerned? Surprisingly, the answer is ‘no’.
Section 2(1)(e)(x) says clearly that a citizen of a foreign country is a foreign source. In the case
of dual-citizenship, a person will be an Indian citizen but will also be a foreign citizen. Thus,
he or she will attract clause (x) and will be treated as a foreign source!
2. Government
Government of a foreign country or territory is a foreign source4. When does a group become
government of a foreign country? When the Indian Government recognizes it. For example, India
did not recognize Taliban as government of Afghanistan5 during the years it was administering
large parts of Afghanistan.
This distinction is more important for diplomatic relations than for FCRA. So far as FCRA is
concerned, both (recognized Government and unrecognized one) will be treated as a foreign
source.
Agencies of a foreign government are also treated as a foreign source.
3. International Agencies
All international agencies are a foreign source. However, multilateral agencies such as UNO, its
specialized agencies, IMF, World Bank are not treated as a foreign source. Apart from these,
Government can also exempt other international organizations from the definition6 .
Why this ‘discrimination’? Well, the reason appears to be that multilateral agencies such as UN,
etc. are not under control of a single nation or group. It is assumed, therefore, that their funds
can not be used to subvert Indian institutions.
But what is an international agency? The Act does not say anything on this. In common usage,
‘agency’ means an organization providing a public service. In some cases, agency may also
mean a special Government Department (e.g. USAID) concerned with a specific field. When
such an organization operates on an international scale, it is called an ‘international agency’.
4. Non-profit organisations
Foreign trusts, foundations, societies, clubs and other associations also are foreign sources.
These are discussed on next page in more detail:
3
The PIO card fees is US$ 1,000.
4
Sec. 2(1)(e)(i)
5
This merely means that Taliban will be categorized as a non-governmental foreign source.
6
At present more than 104 organisations are exempt from this definition. S.O. 1014(E) dated 13-Nov-00.
Gazette of India, Extraordinary. Part 2, sec. 3, sub-section (ii)
102
a. Trusts
What is a foreign trust? The Act does not say about this. However, normally a trust7 formed
abroad would be a foreign trust. Also, a trust formed in India by a foreigner could be a foreign
trust. Foreign trusts are a foreign source8 .
b. Foundations
Foundations are also like trusts, though sometimes the term is also applied to other type of
organisations. The section talks about two types of foreign foundations:
a. a foreign foundation which is in the nature of a trust; and,
b. a foreign foundation which is mainly financed by a foreign country is a foreign source9 .
Now a doubt arises. What would be the status of a foreign foundation, which is not in the nature
of a trust, and is not supported by a foreign country? It is possible that such a foundation will
not fall within this clause10.
What about a society formed in India by foreigners? This is also not clear from the Act.
d. Corporations
In some countries, non-profit organizations are registered as charitable corporations. These are
also treated as foreign source13 .
e. Trade Unions
A trade union formed or operating in a foreign country (or territory) is a foreign source14 . It does
not matter whether it is registered there or not.
What is a trade union? Trade Union is defined in sec. 2(k) of the FCRA. However, this definition
is relevant for Unions registered in India only. It is, therefore, not valid for interpreting sec.
2(1)(e)(vii). FCRA provides another definition in sec. 2(1)(k). This one refers to unions registered
under Trade Unions Act, 1926. Therefore, even this does not appear to be relevant for foreign
trade unions discussed in section 2(1)(e)(vii).
The definition of a Trade Union will vary from country to country. For example, the standard
reference Black’s Law Dictionary15 defines it as ‘a union composed of workers of the same or
of several allied trades’. This may perhaps be relevant in some Western countries. But what
about a Trade Union formed and registered in an Arabian country? Or in Russia?
This is an issue which the Government may perhaps rectify when it next amends the FCRA.
7
A trust is formed by attaching a legal obligation to a property. This is done by the owner of the property
who makes a Trust Deed. Trustees are also nominated and are responsible for fulfilling the legal obligation.
8
Sec. 2(1)(e)(viii)
9
Sec. 2(1)(e)(viii)
10
However, it may be that it will be caught by another clause because it’s registered as a corporation,
society or a company. If everything fails, then it will be probably be netted by the fact that the definition in
section 2(1)(e) is merely an inclusive one!
11
Also clubs or other associations of individuals
12
Sec. 2(1)(e)(ix)
13
Sec. 2(1)(e)(iv)
14
Sec. 2(1)(e)(vii)
15
7th Edition, 1999. p.1532
103
5. Business Organisations
Five types of business organizations are listed: 1. a foreign company, 2. subsidiary of a foreign
company, 3. a foreign corporation, 4. a multi-national corporation, and 5. a company controlled
by foreigners. All five are treated as foreign source.
a. Company
What is a foreign company? It is defined in section 591 of the Companies Act, 1956. Any
company incorporated16 outside India is a foreign company17 .
b. Subsidiary
Any subsidiary18 of a foreign company is also treated as a foreign company. It does not matter
if the subsidiary is formed in India.
c. Corporation
As discussed above, a corporation formed in a foreign country is a foreign corporation. What
is a corporation? It has four key features19 :
(i) It is an entity recognized by law;
(ii) It has a personality of its own, distinct from the persons who formed it;
(iii) It has only those powers which its constitution gives it;
(iv) It has perpetual succession.
Sounds complicated? Well, a company and a society are both examples of corporations.
The definition21 of an MNC has two parts. First, that the corporation should have an office or
business in two or more countries. Second, the corporation should have been formed in a
foreign country.
What does this mean? If an Indian corporation22 starts operating in a foreign country, it will not
become an MNC for the purpose of FCRA.
Permitted institutions
The last para of section 2(1)(e) provides a special exemption. Any foreign institutions permitted
to work in India by Indian Government are not a foreign source.
What does this mean? There are many foreign organizations working in India. The Government
may have a special agreement with some of them. Others may have been given permission
by RBI or other Government agencies. Are these a foreign source or not?
16
Formed
17
There is a quirk in the definition given in section 591: the company should have an office in India. If we
interpret this literally, it may appear that a company registered in Belgium will not be a foreign company,
if it does not set up an office in India!
18
When does company A become a subsidiary of company B? There are four ways: (i) B controls the board
of A; (ii) B controls more than 50% of the voting power (in general meetings) in A; (iii) B holds more than
50% of the equity shares in A; (iv) B is a subsidiary of A under the laws of B’s home country (the country
where B was formed).
19
Based on Black’s Law Dictionary, 1999, p.341
20
Multi-national corporation
21
Explanation to section 2(1)
22
or company
104
Such permissions or agreements mean nothing for FCRA. This exemption is available only if
the Government has issued a notification in the official Gazette permitting the organization to
work in India.
FC Receivers
There are six categories of receivers under FCRA:
1. Political parties
‘Political party’ is defined in section 2(1)(g) of FCRA. Political parties can not receive foreign
contribution under any circumstances. There is no case by case prior permission or exemption
from this rule.
4. NGOs
The Act regulates receipt of foreign contribution by any association27 which has definite program28.
Such organisations are commonly refered as NGOs29 , NPOs30 , PBOs31, or Development
Organisations. These organisations can get foreign contribution after registration under FCRA
or getting prior permission on a case by case basis. Mostly, this foreign contribution is exempt
from income tax.
23
Form FC-1
24
See Table ‘Organisations of a Political Nature’ on page 106
25
‘Candidate for election’ has been defined in section 2(1)(b). Election means election to a ‘legislature’
The word ‘legislature’ itself has been defined in section 2(1)(f)].
26
Electronic media was under government control till early 90’s, and the Act has not been amended since
1985.
27
Defined in section 2(1)(a)
28
See section 6(1)
29
Non-governmental Organisations
30
Non-profit Organisations
31
Public Benefit Organisations
105
5. Private individuals
Private individuals can get foreign contribution freely. However, this is subject to applicable
taxation laws. Private individuals must report receipt of foreign contribution in the nature of
scholarship or stipend, etc. if it exceeds Rs.36,000/- per year.
6. Business organisations
Business organisations can get foreign contribution32 freely without any registration or reporting.
This is subject to normal taxation laws.
Business Transactions
Are business transactions of NGOs outside FCRA? Section 2 defines ‘foreign contribution’ using
the words ‘donation, delivery or transfer’. Some people argue that the word ‘donation’ defines
the types of delivery or transfer that law-makers had in mind. If this is correct, then business
transactions of NGOs would not be covered.
Before concluding this, let’s look at sections 4 and 8 also. Section 4 says that politicians,
journalists, etc. will not accept foreign contribution at all. However, section 8 says that these
people are allowed to accept some types of foreign contribution. The section gives a list, which
includes salary, wages, ordinary business remittances, some gifts, etc.
If this argument is correct, then what was the need for section 8?
Therefore, our view is that to begin with foreign contribution includes practically every remittance
from a foreign source. Even ordinary business remittances to business houses are foreign
contribution. However, the Act does not restrict acceptance of foreign contribution by business
houses. Restrictions are placed only on people in sensitive positions (political parties, politicians,
journalists, etc.) and NGOs.
Name Address
A.K. Gopalan Bhavan Trust 27-29, Bhai Veer Singh Marg, Gole Market
New Delhi
Akhand Kirtni Jatha
Akhil Bhartiya Vidyarthi Parishad Mumbai
All Assam Students Union Gauhati University Campus, Jhalukhari,
Gauhati, Kamrup District, Assam
All India Agricultural Workers Union 12-B, Feroze Shah Road, New Delhi
All India Confederation of Bank Officer Pandyan House, Ferere Road, Mumbai-38
Organisations
All India Defence Employees Federation Pune
32
‘Foreign contribution’ as defined in section 2(1)(c) includes both commercial as well as
charitable transactions.
106
Name Address
All India Democratic Student Organisation 48, Lenin Sarani, Kolkata
All India Democratic Women’s Association 23, Vithal Bhai Patel House, Rafi Marg,
New Delhi
All India Federation of Electricity Employees Residency Road, Sadar, Nagpur
All India Federation of University & college
Teachers Organisations Kolkata
All India Insurance Employees Association Kolkata
All India Kisan Sabha 4, Windsor Place, New Delhi
All India Kishan Sabha 4, Ashoka Road, New Delhi
All India LIC Employees Federation Mumbai
All India Loco Running Staff Association Lumding, Assam
All India Mazdoor Sangh Mumbai
All India Milli Council 161/32, Joga Bhai, Jamia Nagar,
New Delhi-25
All India Muslim Majlis-e-Musharat E-3, Abul Fazal Enclave, Okhla,
New Delhi
All India National Life Insurance Employees
Federation Mumbai
All India Peace and Solidarity Organisation K-1/16, Chitaranjan Park, Main Road, New
Delhi
All India Railway Employee Confederation 26/12, Railway Colony, Kisanganj, Delhi-7
All India Railway Worker’s Federation New Delhi
All India Railwaymen’s Federation New Delhi
All India Sikh Students Federation Amritsar
All India State Government Employees
Federation Hyderabad
All India Student Federation New Delhi
All India Trade Union Congress New Delhi
107
Name Address
Bharatiya Khet Mazdoor Union 4, Windsor Place, New Delhi
Bharatiya Mozdoor Sangh Ram Naresh Bhawan, Pahargunj, New Delhi
Bhartiya Kamagar Sena Mumbai
Centre for Indian Trade Unions 15, Talkatora Road, New Delhi
Citizen’s for Democracy New Delhi
Comsomal Kolkata
Dal Khalsa Chandigarh
Dalit Panthara Bhawani Path, Pune
Dalit Panthers Wadala, Mumbai
Damdami Taksal Gurudarshan Prakash Mehta Chowk, New
Delhi
Delhi Gurudwara Prabhandhak Committee Mata Sundri Lane, New Delhi
Democratic Youth Federation of India 11, Windsor Place, New Delhi
Dennai Talimi Council Lucknow
Dravida Kazhagam Periyar Thaidal, 50, EVK, Sampath Road,
Madras-7
Education Relief And Welfare Sector Panditya Road, Kolkata
Hind Mazdoor Sabha Mumbai
India Society for Cultural Co-operation and 1, Lady Hardinge Road, Opp. Marina Hotel,
Friendship Connaught Place, New Delhi
Indian National Plantation Workers Federation Dibrugarh, Assam
Indian national Plantation Workers Federation Suite 125, 25-A, Parl Street, Kolkata-16
Indian National Trade Union Congress 4, Bhai Veer Singh Marg, New Delhi
Indian Youth Congress (I) New Delhi
Indo - China Friendship Association New Delhi
Institute of Indian Labour Kolkata
Iqbal Memorial Trust Bemina, Srinagar, Kashmir
Iranian Students Islamic Association or Union
of Iranian Students Islamic Association Bangalore
Ishaat-e-Islam Trust 1353, Chitli Qabar, Delhi
Islamic Study Circle Red Cross Road, Opp. Hazi Masjid,
Maisuma, Srinagar
Islamic Welfare Trust PO Omessary, via Kottuwalli, Calicut Distt.
J & K People’s League Srinagar
Jamat Ahle Hadis or All India Ahle Hadis 4116, Ahle Hadis Manzil, Urdu bazaar, Delhi
Jamat-e-Islami Hind Dawat Nagar Abul Fazal Enclave, Okhla,
New Delhi
108
Name Address
Jammat Ahle-e-Hadis J&K
Jammat-e-Islami Bulbul Bagullah
Jammu & Kashmir Muslim Augaf Trust Zero Brigade, Srinagar
Jammu & Kashmir Muslim Auqaf Trust Srinagar
Janta Yuva Morcha New Delhi
Kerala Trade Union Front Chettiangadi, Trichur
Kisan Seva Samiti Chhatarpur, M.P
Labour Progressive Federation Arivagam, Rayapuram, Madras
Maharashtra Ekikaran Samiti Sahar Samiti Karyalya, Jalti math, Near
Kapil Theatre, Kirloskar Road, Bangalore
Mahase-e-Azadi J&K
Marathwada Janta Vikas Parishad Saraswati Bhavan, Sikshan Prasarak
Mandal College, Aurangpura, Aurangabad
Nag Vidharbha Andolan Samiti Nagpur
National Federation of Indian Railwaymen New Delhi
National Federation of Indian Women New Delhi
National Federation Of Post & Telegraph
Employees (K.L. Moja Group) New Delhi
National Federation of Posts & Telegraph
(Shashi Bhushan Group) New Delhi
National Federation of Progressive Writers 11, Kansal Bhawan, K.G. Marg. New Delhi
National Front Indian Trade Unions 10, Government Place East, Ezra Mansion,
Kolkata
National Labour Co-ordination Council Kolkata
National Labour Organisation Ahmedabad
National Students Union of India (I) 5, Raisina Road, New Delhi
Nikhil Banga Mahila Sangha Kolkata
Orissa Gramin Mazdoor Sangh Santapur, Bhubaneswar, Orissa
People’s Union For Civil Liberties 8, Sahayog Apartments, Mayur Vihar,
Phase-I, New Delhi
People’s Union For Democratic Right Quarter No. 4, IP College, Delhi University,
Delhi
Progressive Democratic Students Union Hyderabad
Progressive Labour Union Durgapur, West Bengal
Progressive Student Union Kolkata
Proutist Universal New Delhi
Punjab Student Union
Radical Student Union Hyderabad
109
Name Address
Rashtra Sevika Samiti Wardha, Maharashtra
Rashtriya Swayam Sewak Sangh Hedgewar Bhavan, Nagpur
Revolutionary Youth Front 124/C, Lenin Sarani, Kolkata
Sarva Shramik Sangh Mumbai
Seva Dharam Mission Varanasi, U.P.
Shiromani Gurudwara Prabhandak Committee Golden Temple, Amritsar
State Central Labour Union Srinagar
Student Federation of India 11, Windsor Place, New Delhi
Student Islamic Movement in India 151-C, Zakir Nagar, New Delhi
Student Islamic Movement in India Aligarh
Swantantra Thozilai Union, State Muslim
League office Calicut
Swantantra Thozilali Union Mavoor, Calicut
Tabligh Jammat Bangle Wali Masjid, Nizammudin Basti,
New Delhi
Tamilnadu Toilers Progressive Party Madras
Tamir-e- Millat Hyderabad
The Kannada Paksha 31, Nanje Gowda Road, Mavalli, Bangalore
The Neelchakra Dolamundai, Cuttak
Trade Union coordination Centre 28,Gurudwara Rakabganj Road, New Delhi
Tribal Front Agartala
United Trade Union Congress Bipin Behari Ganguly Street, Kolkata
United Trade Union Congress Lenin Sarani, Kolkata
Universal Proutists Student Federation New Delhi
Vishwa Hindu Parishad Mumbai
Volunteer Social Service Allahabad
West Bengal Chhatra Parishad Kolkata
William Carey Study & Research Centre Kolkata
Yuva Janta New Delhi
Yuva Lok Dal 3, Pt. Pant Marg, New Delhi
110
Mysteries of FCRA33
For the voluntary sector, FCRA remains the most mysterious piece of law. Partly this is due
to the manner in which it has been interpreted at different times and partly it is due to the
secrecy surrounding its implementation.
The work of many Indian NGOs is dependent on foreign funds. And they live under a constant
fear of FCRA — for they do not know when their FCRA number may be snatched away.
Curiously enough, in actual practice, most NGOs lose their FCRA registration because of dis-
use and not because of mis-use. Mostly these are organisations which are not active and do
not file their annual FCRA return despite follow-up by FCRA Department.
As on 7th August ‘01, only 12 NGOs had lost their FCRA registration for reasons such as
misuse of funds or anti-national activities (list at www.AccountAid.net).
1. Prior permission
If you have applied for prior permission, then your application should be processed within 90
days [section 11(2)]. The period of 90 days starts from the date when the application is received
at FCRA Department.
The Ministry may also write to you, asking you to wait for another 30 days. In such case, the
total period will go up to 120 days [proviso to section 11].
In all cases, the Ministry sends a reply, whether yes or no. Please do not assume that if you
haven’t received a reply within 120 days then your application is approved. Your reply may have
been lost in the post.
2. FCRA Number
Refusal: FCRA Department sometimes refuses permanent registration to NGO’s (section 10).
If you wish, you can appeal against this in the High court within 60 days of the date of the
order [section 21(2)].
Cancellation: If your FCRA registration is canceled, don’t panic. File an appeal in the High
Court within 60 days of order date [section 21(2)]. If the cancellation is unjustified, the court
will restore your registration.
New NGOs: If you had applied for FCRA registration after 27th December 1996, in the revised
FC-8, then you can change bank accounts by applying on plain paper (undertaking in your
original application in form FC-8).
33
Based on AccountAble 22: Mysteries of FCRA
111
4. More than one bank account
You can receive and keep your FCRA funds only in one bank account [section 6; rule 8(1)(b)].
This bank account number is mentioned on your copy of the FCRA registration certificate.
However, once the money has been received in the FCRA bank account, some NGOs transfer
funds to other locations / bank accounts for operational reasons. This includes bank accounts
for field offices as also fixed deposit accounts.
There is no bar on keeping FCRA funds in fixed deposit accounts, where necessary. However,
please note that as per the existing law, NGOs can not open more than one bank account for
FCRA funds. Further, the Ministry of Home Affairs has not granted any official sanction permitting
this widespread practice.
Still, if you are maintaining bank accounts in the field for FCRA funds, you should take the
following precautions:
i Open such accounts only when absolutely necessary, and justified for operational
reasons.
iv When transferring funds between these accounts, use only account payee cheque
or draft, wherever possible.
While this is not clear from the FCRA Act itself, the FCRA Department has taken this view.
The recent changes in form FC-3 (26-July-2001) includes reporting of interest on FCRA Funds.
6. Revolving Fund
If you are giving recoverable loans to beneficiaries out of FCRA funds, you should show these
loans as assets in the FCRA Balance Sheet. However, these can be treated as utilization of
FCRA funds in FC-3.
When these loans are recovered you should show the money received in FCRA Receipts and
Payments Account and FC-3.
When loans are given out again (out of recovered funds), you should continue to show these
in the same manner in the FCRA Balance Sheet and Receipts and Payments Account.
112
If later on any of these assets are sold off, then the amount recovered should be again shown
as receipt in FC-3. If you make a profit or gain in selling the asset, this also should be shown
in FC-3.
If the asset (for example, land) was funded partially out of FCRA and partly out of Indian funds,
the profit should be proportionately accounted in FCRA and Indian funds.
113
Whether the second NGO is an NGO registered under Societies Act or not, this type of
arrangement is illegal and strictly prohibited. In case this comes to the notice of FCRA Department
then they will go behind the accounts and vouchers and will discover the real arrangement
(section 28). The penalty for this is laid down in section 23 and includes imprisonment.
21. Elections
NGOs registering with FCRA now (after 27th December 1996) will need FCRA approval if 50%
or more office bearers get changed in elections (see undertaking in form FC-8).
Till the time they get the approval, they will not be able to accept funds without prior permission
for each grant.
114
Puzzles of FCRA34
A strict interpretation of FCRA [Foreign Contribution (Regulation) Act, 1976] gives you strange
results. Consider the following common situations:
1. A student from Ghana registers at an Indian University and pays the course fees. The
university is violating FCRA if it admits him without having an FCRA number.
2. A well know educational trust runs schools all over India. One of the schools brings out a
souvenir. The mother of one of the students works for an International Bank. They insert
an advertisement in the souvenir. Is this a violation of FCRA?
3. The Ambassador of Zenda visits the shop of an NGO at Dilli Haat and buys two hand-knit
shawls. The NGO should deposit this in their FCRA account or lose their registration.
4. An NGO gives a revolving fund grant to Kalyani Mahila Mandal. The grant is given from FC
funds. The Mahila Mandal is functioning as an unregistered society and does not have
FCRA. Both the NGO as also the Mahila Mandal are in deep trouble.
5. A foreign relief Agency ties up with an NGO in Puri to help them distribute polythene
sheets. The NGO receives and stocks these in their office. But they do not have FCRA.
Both the Agency and NGO have violated FCRA.
Is there a solution to this? As the conditions in society change, laws need to change. The FCRA
completed silver jubilee on 5th August 2001. It is unlikely that the Government will repeal it in
near future. But, there is a need for review so that there can be reasonable compliance. We
discuss here 19 puzzles of FCRA. Section references are to Foreign Contribution (Regulation)
Act, 1976.
But, there is one very important condition. The individual must work totally on his/ her own. He
or she should not employ people or tie up with others. In legal terms, he / she must not form
an association of individuals or an organisation [Section 2(1)(a)].
3. Electronic media
FCRA covers print-media. But it does not cover electronic media (radio and TV). Why?
Back in 1976, Government ran the entire electronic media. Secondly, the main Act has not been
amended since 1985. Electronic media was opened up to private sector much later.
34
Based on AccountAble 55: Puzzles of FCRA
115
This does not mean that you have changed your bank account. Just write a letter to the FCRA
Department explaining this. Attach a copy of the bank’s letter showing change of account
number.
However, the Act does not prohibit taking or giving loans to the Indian section. The most
obvious example is money required to open the FCRA bank account. This money is always a
loan from the Indian section.
In recent years, FCRA Department has felt that this facility is being used carelessly. As a
result, they often take up glaring cases with the concerned NGOs.
7. Mahila Mandals
Do Mahila Mandals need FCRA to receive loans or grants from FC-funded NGOs?
This is a very complex question. To understand this, Mahila Mandals can be categorised into
five stages of evolution:
35
Section 2(1)(a)
36
Section 6(1)
116
8. Indian office of foreign Agency
If a foreign donor agency opens a branch or liaison office in India, the Indian office needs FCRA
registration or prior permission. This applies even if the branch office is only receiving
administrative funds and not grants.
Can the organisations under the main umbrella use the FCRA of the parent body?
No. Under FCRA, each of these NGOs is a separate entity and needs independent FCRA
registration or prior-permission. This concept also applies to Federations.
117
When these are spent or given to individual beneficiaries, the funds become Indian. However,
if these people give it back to the NGO (for example, repayment of a loan), they again become
FCRA [explanation to section 2(1)(c)].
The catalogues or booklets are now foreign contribution. You should enter these into FC-6. You
should also report this in FC-3.
16. Relatives
Till death do us part… holy vows of matrimony notwithstanding, it is not a good idea to keep
your spouse on the board.
Nowadays, FCRA people get alarmed when they find assorted sons, parents, in-laws and other
family members on the board of an applicant NGO. This often results in rejection of the NGO’s
application for FC registration or prior-permission.
Possibility Treatment
1. Donor Agency has asked you to use Use it according to Agency’s directions.
this income in a certain manner.
What are unrestricted funds? These are similar to General Fund in the Indian section. We use
a different name for clarity. You can use these funds to maintain your buildings, meet other
institutional expenses or add to your corpus.
You can also use it for any other purpose for which the organisation has been registered with
FCRA. How do you find that out? Read the objective clause of your Memorandum of Association.
Whatever you do, remember that you should not move these funds into the Indian section. They
must remain in FCRA account. You must also follow all other normal precautions related to
FCRA funds.
118
18. Unrestricted FC funds – under Prior Permission
Suppose you do not have FCRA registration. You have been working under prior-permission.
Then you can use the unrestricted funds only for the approved project. You cannot use these
for general organisational purposes.
Not in the near future. The purpose of these two laws is different. FERA / FEMA is a financial
law. FCRA is an internal security law. FCRA, therefore, has nothing to do with economic
liberalisation.
This is also the reason why the Government cannot move FCRA from Ministry of Home Affairs
to Ministry of Finance.
37
Foreign Exchange Regulation Act, 1973
38
Foreign Exchange Management Act, 1999
119
Fund-raising and FCRA39
FCRA was passed during the Emergency days (5th August 1976). Initially, it only asked NGOs
to report how much foreign contribution they receive and spend. The purpose of the Act was
to gather information. You did not need FCRA registration or even prior-permission to receive
foreign contribution.
This ‘genial’ regime lasted for a little over eight years. In 1985, compulsory FCRA registration
was introduced. You could not receive foreign funds if you did not have FCRA registration or
prior-permission. However, registration was very easy in those days. People who were already
getting foreign funds were sent registration certificates automatically. These days things are a
little different.
The main point is that FCRA was originally designed only for gathering information. The provisions
for compulsory registration were grafted on later. This has produced some strange results.
Consider this fictitious dramatization: There is an NGO running an old age home in Delhi. A
foreigner, who has been living in Delhi for several years, drops by one day. She likes the place.
So, next time she brings along some old warm clothes. The secretary is delighted and thanks
her profusely. The next day, both are arrested and put into jail. Why? The NGO did not have
FCRA registration!
Fortunately, FCRA is implemented in spirit and not by the letter of the law. The Department
understands that a rigorous interpretation or implementation will cause injustice. So the above
story will probably not become news. Nevertheless, the point remains. The law exists and can
be misused. Therefore, it needs to be redesigned.
The provisions discussed here are based largely on the existing law. Some of the provisions
may seem ridiculous or unnecessarily harsh. Therefore, keep the above in mind: FCRA people
are not planning to put you in jail just because you accepted an old shirt from a well-wisher!
The following issues / comments are mainly related to raising of funds. Sections refer to FCRA
[Foreign Contribution (Regulation) Act, 1976].
1. Anonymous donations
Electronic banking and Internet fund-raising is here. You suddenly receive a credit of Rs.1.3
lakhs in your bank account. The donor does not tell you his or her name. What do you do?
Ask your bank to trace back the donation. If it came from an overseas account, transfer it to
your FCRA account. Then report it in FC-3 as ‘Anonymous Donation’. Attach a copy of FIRC
(Foreign Inward Remittance Certificate) from the bank.
2. NRI donations
NRI donations to an Indian NGO may be Indian funds or FC funds. If the NRI holds an Indian
passport, then the donation will be Indian funds. If not, then these will be FC funds.
3. Charity events
NGOs sometimes organise cultural events for raising funds. At these events, they sell donor
passes. These passes are priced high, to generate a surplus. For example, a ticket for a movie
may normally be priced at Rs.100. If it is organised as a charity event, donor pass may be for
39
Based on AccountAble 54: Fund-raising & FCRA
120
Rs.500 or more. What are the FCRA implications of this?
There can be two situations, depending on how the event was funded:
Separating guests into Indian and foreigners will not be easy. Therefore, implement this only to
the extent it is practical. For example, do not bother to segregate counter sales, when received
in Indian currency.
6. Sale of Publications
If the book has been published with FCRA funds, then the sale recoveries (often termed
‘contribution’ or ‘sahyog rashi’) should be kept in FC accounts.
7. Staff Recoveries
NGOs sometimes make recoveries for STD calls, room rent, etc. from staff. Where should these
recoveries go?
If the related expenditure (phone bill, office rent, etc.) is booked in FCRA, then the recoveries
should also be credited to FCRA.
121
Ideally, these recoveries should be credited to the concerned Agency’s project accounts. If this
is not required, then these can be taken to FCRA unrestricted funds40.
8. Hire Charges
If you recover hire charges for an asset from a project, where should the income be shown?
If the asset is in FC Balance Sheet, then the income should go to FCRA account. These can
be shown there as unrestricted funds (similar to General Fund).
9. Guest recoveries
If your NGO is not registered under FCRA, do not accept any payments (for food, etc.) from
foreign volunteers who stay. You will be violating FCRA!
If you do have FCRA registration, credit these recoveries to the FCRA accounts.
If the recovery is against items purchased from FC funds, then the recovery is FC money. If
the recovery is for FC-6 items, then also it is FC money.
In case of services, you should see how the related expenses are met. If the clinic or workshop
is funded by FC funds, then the recoveries must be reported in FC-3.
For example, if the permission is in dollars, you can receive that many dollars or equivalent
Indian Rupees.
40
Funds that can be spent at NGO’s discretion. See ‘17. Unrestricted FC funds’ on page 118 for more
details.
41
For example: ‘Ford Endowment Fund’
42
For convenience, you can group these together as, for example: ‘Ford Endowment Investments’
122
15. Exchange rate variations
Also, in prior-permission cases, you may sometimes receive a little more due to exchange rate
variations.
Don’t worry43. Just report the actual amounts received. Also give a note in FC-3 saying ‘excess
received due to change in Exchange Rate’.
Therefore, if a foreigner gives your NGO a wall clock worth Rs.800, you should record it in FC-
6 and report it in FC-3.
20. PL-480
PL-480 means Public Law number 480. It was passed a long time ago in United States of
America. Indian NGOs have been receiving bulgur, oil and milk powder under PL-480. This is
distributed to beneficiaries.
These items are received under an agreement between Indian Government and US Government.
However, these are routed through USAID and one or more American donor agencies.
When received in India, these are foreign contribution. The NGO receiving and distributing these
must maintain an FC-6 and report these in FC-3. The NGO must also have FCRA or prior
permission to handle these items.
However if you receive funds directly from a bilateral Agency, then these will be FCRA funds.
43
This is not a problem for those who have FCRA registration.
123
124
Section IV: Forms
Whether you believe it or not, forms were invented to make your life simple! However, as time
passed, people must have found this unsatisfactory and must have started making simple
things complicated.
FCRA forms, by and large, are not very complicated. However, there have been frequent
changes in the forms in the last few years. The last change that took place was on 26th July
2001, when form FC-3 was revised.
In this section, we have included the following forms:
The text of the Act and the rules is also given for your convenience.
The Foreign Contribution (Regulation) Act, 1976 156
Please note that this does not purport to be the authorized or correct text of the Act or the
Rules, for which you must refer to the text published in the Gazette of the Government of India.
125
126
Form FC-1A1
[See Rule 3 (aa)]
Form of application for seeking prior permission from the Central Government under the
Foreign Contribution (Regulation) Act, 1976 (hereinafter referred to as the Act) for the
acceptance of foreign contribution by an Association having a definite cultural, economic,
educational, religious or social programme.
No.___________________ Date____________________
To,
Subject: Application for seeking the prior permission of the Central Government under the
Foreign Contribution (Regulation) Act, 1976 for acceptance of foreign contribution.
Sir,
Name:
Address:
Town/City: District:
1
Revised Form FC-1A (w.e.f. 24-Jan-2000)
127
(iv) Please indicate the main aim(s) and object(s) of the Association (enclose a copy of
Memorandum of Association and/or the Articles of Association, if applicable).
(v) Please furnish the names and address of the members of the Executive Committee/Governing
Council, etc. of the Association, including the Chief Functionary, in the following manner:
1 2 3 4 5 6 7 8
1.
2.
3.
4.
5.
6.
7.
2. Please indicate whether any member of the Executive Committee/Governing Council, etc.
of the Association, including the Chief Functionary has in the discharge of his/her official
functions –
(a) been convicted by any court of law;
(b) a prosecution for any offence pending
against him/her;
(c) been found guilty of diversion or
misutilisation of funds of the
Association or any other association
in the past.
3. Please indicate whether the applicant
Association –
(a) is a branch/unit/associate of foreign
based organisation or another
association already registered under
the Act. If so, name and address of
the parent organisation should be
furnished;
(ii) whether the Association has close links with another association, or its unit or branch which
has been–
(a) refused registration under the Act,
(b) prohibited from accepting foreign
contribution.
5. Please indicate,–
(i) whether the Association was,–
(a) granted prior permission to receive
foreign contribution under the Act in the
past. If so, the number and date of the
letter granting prior permission should
be furnished;
(b) whether the account of the receipt
and utilisation of the foreign
contribution received above was sent
to the Central Government in the
prescribed form. If so, the date of
submission of the accounts should
be furnished:
(c) if the prior permission was granted in
the current year, details of the foreign
contribution received and utilised,
purpose-wise, showing the unspent
balance should be annexed.
(ii) whether the Association has received foreign contribution without the prior permission of the
Central Government, in the past. If so,–
(a) full particulars of the foreign
contribution received, address of the
branch of the bank and account number
in which deposited should be
furnished;
129
(b) whether the said violation has been
condoned by the Central Government;
(c) whether the Association has been
prohibited from accepting foreign
contribution under the Act.
6. Please indicate whether the Association
is owner/printer/ publisher, editor of a
publication which is a “registered
newspaper” under the Press and
Registration of Books Act, 1867.
7. Please furnish–
(i) Details of the activities of the
Association during the past three
years;
(ii) Copies of the audited statement of
accounts of the Association for the
past three years.
8. (i) Please indicate the–
(a) nature and value of foreign
contribution to be received (a copy
of the latest commitment letter from
the donor should be furnished);
(b) the purpose for which the foreign
contribution is proposed to be
received and utilised indicating also
the geographical area(s) to be
covered.
(ii) A copy of the proposal/project which
has been approved by the foreign
source for funding, including projected
outlays/budget breakup, should be
enclosed.
(iii) A copy of the proposal/project which
has been approved for funding out of
the foreign contribution should be
enclosed (This column applies only
to sub-sequent recipients).
9. Please indicate–
(i) the name of the bank and address of
the branch through which foreign
contribution is proposed to be
received;
(ii) the account number in the said branch
of the bank.
10. Please indicate the particulars of the foreign source or the sources* from which the foreign
130
contribution* is proposed to be received:–
(a) If an individual, his personal
particulars including name, present
address, permanent address,
nationality, profession;
(b) If an Organisation/ Institution/
Association/ Trust/ Trade Union, etc.,
full particulars thereof, including –
Yours faithfully,
Declaration
I hereby declare that the above particulars furnished by me are true and correct.
Place:
Date:
131
“CERTIFICATE”
(To be submitted alongwith the application)
This is to certify that the …………………………………….............……………......… (name of the
association) having its registered office at ……………….........….…….........…………………
(address) has been formed for undertaking activities in its chosen ……….....………………………
(Economic, Educational, Cultural, Religious and Social*) field of activity. The antecedents of the
organization have been verified and there is nothing adverse against them.
3. The grant of prior permission to the aforementioned association to accept foreign contribution
amounting to…..….....……………...(Currency/ Amount) from ……………...….……….. (Name and
address of foreign donor) under the Foreign Contribution (Regulation) Act, 1976 for the said project
is recommended.
(Recommending Authority)**
(With Seal)
** Any concerned –
(1) Collector of District
132
Form FC-32
See Rule 4(a)
Account of Foreign Contribution of the year ending on 31st March _______
1. Association’s details
(i) Name and address (in capital letters) (ii) Registration No. and Date ....................................
[under FC(R) Act 1976]:
4. $ Religious 5. $ Social
(v) Denomination in case of religious Association:
(a) Hindu (b) Sikh (c) Muslim
(d) Christian (e) Buddhist (f) Others
1A. (i) Total amount of foreign contribution received during the year: ..........................................................
(ii) Interest earned on the foreign contribution during the year, –
(a) In the designated bank account: ..........................................................
(b) On investments made (Fixed Deposit Receipt etc) during the year or in the preceding years: ..........................................................
2
Revised Form FC-3 (w.e.f. 26-Jul-2001)
2. Purpose(s) for which foreign contribution has been received and utilised:
Sl. Purpose Previous Balance Receipt during the year Utilised Balance
No. As first recipient As 2nd / subsequent Total
recipient
In cash In kind In cash In kind In cash In kind (5+6+7+8) In cash In kind In cash In kind
(value) (value) (value) (value) (value)
1 2 3 4 5 6 7 8 9 10 11. 12. 13
1. Celebration of
national events
(Independence /
Republic day) /
festivals, etc.
2. Theatre / Films.
134
3. Maintenance of
places of historical
and cultural
importance.
4. Preservation of
ancient /
tribal art forms.
5. Research.
6. Cultural shows.
7. Setting up and
running handicraft
centre / cottage
and Khadi industry
/ social forestry
projects.
Sl. Purpose Previous Balance Receipt during the year Utilised Balance
No. As first recipient As 2nd / subsequent Total
recipient
In cash In kind In cash In kind In cash In kind (5+6+7+8) In cash In kind In cash In kind
(value) (value) (value) (value) (value)
1 2 3 4 5 6 7 8 9 10 11. 12. 13
8. Animal husbandry
projects.
9. Income generation
projects / schemes.
10. Micro-finance
projects, including
setting up banking
135
co-operative and
self-help groups.
11. Agricultural
activity.
1 2 3 4 5 6 7 8 9 10 11. 12. 13
15. Grant of stipend /
scholarship / assis-
tance in cash and
kind to poor / dese-
rving children.
notebooks, etc.
1 2 3 4 5 6 7 8 9 10 11. 12. 13
22. Publication and dis-
tribution of religious
literature.
1 2 3 4 5 6 7 8 9 10 11. 12. 13
1 2 3 4 5 6 7 8 9 10 11. 12. 13
suffering from lep-
rosy.
1 2 3 4 5 6 7 8 9 10 11. 12. 13
1 2 3 4 5 6 7 8 9 10 11. 12. 13
53. Environmental
programs.
1 2 3 4 5 6 7 8 9 10 11. 12. 13
and
(b) Purchase of land;
(ii) Construction /
Extension / Mainte-
nance of office, ad-
ministrative and ot-
her buildings;
laries / honorarium;
(iv) Publication of
newsletter / litera-
ture / books, etc.
TOTAL
CAUTION:– Submission of false information or concealment of material facts shall attract the relevant provision of the Foreign Contribution (Regulation) Act, 1976
warranting appropriate action.
3. Name and address of the designated branch A/c No. ……………………………………………………………………..
of the Bank and account number (as specified Bank………………………………….……………………………………
in the application for registration/ prior permis- Branch:…………………………………………………………………….
sion or permitted by the Central Government)
Address:……………………………………………………………………
……..……………………………………….…………………………..….
PIN………………………...…………………….
4. Donor-wise Receipts of foreign contribution (in Rupees)
Sl. Institutional / Individual / Name(s) and address(es) Purpose(s) Date and month Amount
No. Other Donors of receipt
1 2 3 4 5 6
(i) Institutional Donors
143
Sl. Institutional / Individual / Name(s) and address(es) Purpose(s) Date and month Amount
No. Other Donors of receipt
1 2 3 4 5 6
(ii) Individual Donors above Rs. One lakh
144
(iii) Individual Donors below Rs.One lakh (only columns 4 and 6 need to be filled)
Total
5. Country-wise Receipts of foreign contribution (in Rupees)
S. No. Name of the country Amount
1 2 3
1.
2.
3.
4.
5.
145
Total:
DECLARATION
I hereby declare that the above particulars furnished by me are true and correct. I also affirm that the foreign contribution has been utilised for the
purpose(s) for which the Association has been registered/ prior permission obtained. To the best of my knowledge, I have not concealed or suppressed
any fact.
(i) the brought forward foreign contribution at the beginning of the year was Rs. ……………………..…........
(ii) foreign contribution of / worth Rs. ………………..………............. was received by the Association during the year ……………..………………….……….......
(iii) the balance of unutilised foreign contribution with the Association at the end of the year …………………..….. was Rs …………..……………………………
(iv) Certified that the Association has maintained the accounts of foreign contribution and records relating thereto in the manner specified in section 13 of the
Foreign Contribution (Regulation) Act, 1976 read with Rule 8(1) of the Foreign Contribution (Regulation) Rules, 1976.
(v) The information furnished in this certificate and in the enclosed Balance Sheet and Statement of Receipt and payment is correct as checked by me/us.
146
Place _______________
Date ________________
[Sections 7(1) and 7(2) of the Foreign Contribution (Regulation) Act, 1976]
5. Permanent Address
6. Passport particulars
7. Specific details of occupation/
profession
8. Particulars of the foreign source
from whom scholarships, stipend or
payment of a like nature was
received:
(a) If an individual, his personal
particulars including name,
present address, permanent
address, nationality, profession
147
(iii) Aims and Objects
Declaration
I hereby declare that the above particulars furnished by me are true and correct.
Place: _________,
Date: __________
_________________
Signature of applicant
148
Form FC-6
[See Rule 8(a)]
FOREIGN CONTRIBUTION (ARTICLES) ACCOUNTS
DESCRIPTION OF THE ARTICLE: __________________________________
DECLARATION
I hereby declare that the above particulars furnished by me are true and correct.
Signature
Form FC-83
(See Rule 3-A)
Form of application for seeking registration with the Central Government under the
Foreign Contribution (Regulation) Act, 1976 (hereinafter referred to as the Act) for the
acceptance of foreign contribution by an Association having a definite cultural, economic,
educational, religious or social programme.
No.______ Date____________
To,
Subject: Application for registration under the Foreign Contribution (Regulation) Act, 1976 for the
acceptance of foreign contribution
Sir,
I, ………………………………………….…………….., on behalf of the Association named hereafter,
apply for registration of the Association under clause (a) of sub-section (1) of section 6 of the Act
for the acceptance of foreign contribution.
1. (i) Name of the Association and its complete postal address :
Name:
Address:
Town/City: District:
3
Revised Form FC-8 (w.e.f.24-Jan-2000)
150
(iv) Please indicate –
(a) the main aim(s) and object(s) of the
Association (enclose a copy of
Memorandum of Association and/or the
Articles of Association, if applicable);
(b) the main object(s) and definite
programme(s) for which the foreign
contribution is to be accepted/ utilised.
(v) Please furnish the names and addresses of the members of the Executive Committee/
Governing Council, etc. of the Association, including the Chief functionary in the following
manner:
1 2 3 4 5 6 7 8
1.
2.
3.
4.
5.
6.
7.
2. Please indicate whether any member of the Executive Committee/Governing Council, etc.
of the Association, including the Chief Functionary has in the discharge of his/her official
functions–
151
4. Please indicate,–
(i) whether the Association was,–
(a) granted prior permission to receive
foreign contribution under the Act in the
past. If so, the number and date of the
letter granting prior permission should
be furnished;
(b) whether the account of the receipt and
utilisation of the foreign contribution
received above was sent to the Central
Government in the prescribed form. If
so, the date of submission of the
accounts should be furnished.
(ii) whether the,–
(a) Association has received foreign
contribution without the prior permission
under Act in the past. If so, full
particulars of the foreign contribution
received along with complete address
of the bank branch and bank account
number in which deposited should be
furnished;
(b) said violation has been condoned by
the Central Government;
(c) Association has been prohibited from
accepting foreign contribution under the
Act.
152
(ii) whether the Association has close links with another association, or its unit or branch
which has been–
(a) refused registration under the Act;
(b) prohibited from accepting Foreign
Contribution.
7. Please furnish,–
(i) details of the activities of the
Association during the past three years.
Yours faithfully,
(Chief Functionary)
for and on behalf of Association
(Name of Association)
153
Declaration and undertaking
The Association named here-in-above affirms that the information furnished above is correct
and undertakes:–
(i) to inform the Central Government (Ministry of Home Affairs) within thirty days if any change
takes place in regard to the name of the Association, its address, its registration, its nature,
its aims and objects with documentary evidence effecting the change;
(ii) to obtain prior permission for change of office-bearer(s), if, at any point of time such change
causes replacement of 50% or more of the office-bearers as were mentioned in the application
for registration under Foreign Contribution (Regulation) Act, 1976 and undertakes further not
to accept any foreign contribution, except with prior permission, till the permission to replace
the office-bearer(s) has been granted;
(iii) not to change the bank or branch of the bank without prior permission of the Central
Government. The reason for change of bank or branch of the bank shall have to be relevant
and justifiable; and
(iv) not to accept any foreign contribution, unless it has obtained either the registration number,
as applied for hereinabove, or prior permission of the Central Government under sub-section
(1A) of section 6 of the Foreign Contribution (Regulation) Act, 1976.
(Chief Functionary)
for and on behalf of Association
(Name of Association)
Note:
(i) The receipt of application for registration is not a commitment for grant of registration by the
Central Government;
(ii) An incomplete application i.e. without required documents/details/explanations is likely to be
rejected summarily; and
(iii) In case the space against any column is insufficient separate sheets should be attached.
(iv) Please use CAPITAL Letters.
CERTIFICATE
(To be submitted alongwith the application)
This is to certify that the ………………………………..........……...………..(name of the associa-
tion) having its registered office at ………………………………...…………………….…. (address)
has been engaged in Economic, Educational, Cultural, Religious and Social* activities in the
………..…….…..……… (District) of ………...…………… (State) for the last ……………… years.
(2) It has undertaken welfare activities in the area and has incurred expenditure (excluding
administrative expenditure) amounting to ………………….. (Amount in Rupees) during the last
three years on its chosen (Economic, Educational, Cultural, Religious and Social) field of activity.
(3) The antecedents of the organisation have been verified and there is nothing adverse against
them.
(4) The grant of registration to the aforesaid association to accept foreign contribution under the
Foreign Contribution (Regulation) Act, 1976 is recommended.
(Recommending Authority)**
(With Seal)
* Strike out whatever is not applicable
** Any concerned –
(1) Collector of District
(2) Department of the State Government
(3) Ministry/ Department of the Government of India
154
Declaration regarding newspaper/ newsletter
Form X
Declaration
I, …………………………………………. on behalf of the association named hereafter declare
that the printed work/ publication of which the association is the owner/ editor/ printer/ publisher
and whose details have been furnished hereinafter, is not a ‘Newspaper’ as per definition of
Section 1(1) of Press and Registration of Books Act, 1867 and/ or is not required to be
registered under part 6(a) of the said Act (a copy of certificate issued by Registrar of Newspapers
for India to the effect that the said printed work falls within the category ‘B’ of publications as
per classifications made by Registrar of Newspapers for India to be attached).
(i) Name of the Association
(ii) Address of the Association
155
The Foreign Contribution (Regulation) Act, 1976
An act to regulate the acceptance and utilisation of foreign contribution or foreign hospitality by
certain persons or associations, with a view to ensuring that parliamentary institutions, political
associations and academic and other voluntary organisations as well as individuals working in
the important areas of national life may function in a manner consistent with the values of
sovereign democratic republic, and for matters connected therewith or incidental thereto.
CHAPTER I
PRELIMINARY
Section 2. Definitions–
(1) In this Act, unless the context otherwise requires,–
(a) “association” means an association of individuals, whether incorporated or not, having
an office in India and includes a society, whether registered under the Societies
Registration Act, 1860 (21 of 1860), or not, and any other organisation, by whatever
name called;
(b) “candidate for election” means a person who has been duly nominated as a candidate
for election to any Legislature;
(c) “foreign contribution” means the donation, delivery or transfer made by any foreign
source,-
(i) 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, does not
exceed one thousand rupees;
4
August 5, 1976 vide GSR 775 (E), Dt. 5 – 8 – 1976
5
Ins. by Act 1 of 1985, S. 2 (w.e.f. 20 – 10 – 1984).
156
source for providing a person with the costs of travel to any foreign country or territory
or with free board, lodging, transport or medical treatment;
(e) “foreign source” includes–
(i) the Government of any foreign country or territory and any agency of such
Government,
(ii) any international agency, not being the United Nations or any of its specialised
agencies, the World Bank, International Monetary Fund or such other agency as
the Central Government may, by notification in the official Gazette, specify in this
behalf,
(iii) a foreign company within the meaning of the section 591 of the Companies Act,
1956 (1 of 1956), and also includes-
(vi) a company within the meaning of the Companies Act, 1956 (1 of 1956), if more
than one-half of the nominal value of its share capital is held, either singly or in
the aggregate, by one or more of the following, namely:
(viii) a foreign trust by whatever name called, or a foreign foundation which is either in
the nature of trust or is mainly financed by a foreign country or territory,
but does not include any foreign institution, which has been permitted by the Central Government
by notification in the Official Gazette, to carry on its activities in India;
(f) “legislature” means-
(ii) the Legislative Assembly of a State, or in the case of a State having a Legislative
Council, either House of the Legislature of that State,
157
Administration Act, 1966 (19 of 1966),
(v) Municipal Corporations in metropolitan areas as defined in the Code of Criminal
Procedure, 1973 (2 of 1974),
(vi) District Councils and Regional Councils in the States of Assam and Meghalaya
and in the Union Territory of Mizoram as provided in the sixth Schedule to the
Constitution, or
(vii) Any other elective body as may be notified by the Central Government,
as the case may be;
6
[(g) “political party” means–
(i) an association or body of the individual citizens of India-
(1) which is, or is deemed to be, registered with the Election Commission of
India as a political party under the Election Symbols (Reservation and
Allotment) Order, 1968, as in force the time being; or
(2) which has set up candidates for election to any Legislature, but is not so
registered or deemed to be registered under the Election Symbols (Reservation
and Allotment) Order, 1968;
(ii) a political party mentioned in Column 1 of table I to the notification of the Election
Commission of India No. 56\J&K\ 84, dated the 27th September, 1984, as in
force for the time being;]
(h) “prescribed” means prescribed by rules made under this Act;
(i) “registered newspaper” means a newspaper registered under the Press and Registration
of Books Act, 1867 (25 of 1867);
(j) “subsidiary” and “associate” have the meanings respectively, assigned to them in the
Companies Act, 1956 (1 of 1956);
(k) “trade Union” means a trade union registered under the Trade Unions Act, 1926 (16 of
1926).
Explanation– for the purposes of this Act, a corporation incorporated in a foreign country or
territory shall be deemed to be a multi-national corporation if such corporation–
(a) has a subsidiary or a branch or a place of business in two or more countries or territories;
or
(b) carries on business, or otherwise operates, in two or more countries or territories.
(2) Words and expressions used herein and not defined in the Foreign Exchange Regulation
Act, 1973 (46 of 1973), have the meanings respectively assigned to them in that Act.
(3) Words and Expressions used herein and not defined in this Act or in the Foreign Exchange
Regulation Act, 1973 (46 of 1973), but defined in the Representation of the People Act, 1950
(43 of 1950) or the Representation of the People Act, 1951 (43 of 1951), have the meanings
respectively assigned to them in such Act.
6.
Substituted by Act 1 of 1985, S. 2 w.e.f. 20 – 10 – 1984
158
CHAPTER II
REGULATION OF FOREIGN CONTRIBUTION AND FOREIGN HOSPITALITY
(2) (a) No person, resident in India, and no citizen of India resident outside India shall accept
any foreign contribution, or acquire or agree to acquire any currency from a foreign
source, on behalf of any political party, or any person referred to in sub-section (1), or
both.
(b) No person, resident in India, shall deliver any currency, whether Indian or foreign,
which has been accepted from any foreign source, to any person if he knows or has
reasonable cause to believe that such other person intends, or is likely, to deliver such
currency to any political party or any person referred to in sub-section (1), or both.
(c) No citizen of India, resident outside India shall deliver any currency, whether Indian or
foreign which has been accepted from any foreign source, to–
(i) any political party or any person referred to in sub-section (1), or both, or
(ii) any other person, if he knows or has reasonable cause to believe that such other
person intends, or is likely, to deliver such currency to a political party or to any
person referred to in sub-section (1), or both.
(3) No person receiving any currency, whether Indian or foreign, from a foreign source on behalf
of any association, referred to in sub-section (1) of Section 6, shall deliver such currency–
(i) to any association or organisation other than the association for which it was
received, or
(ii) to any other person, if he knows or has reasonable cause to believe that such
other person intends, or is likely, to deliver such currency to an association other
than the association for which such currency was received.
7
Subs. by Act 1 of 1985 of S. 3 w.e.f. 20 – 10 – 1984
159
Section 5. Organisation of a Political nature not to accept foreign contribution except
with the prior permission of the Central Government
(1) No organisation of a political nature, not being a political party, shall, accept any foreign
contribution except with the prior permission of the Central Government.
Explanation– For the purposes of this section, “organisation of a political nature, not being a
political party” means such organisation as the central Government may, having regard to the
activities of the organisation or the ideology propagated by the organisation or the programme
of the organisation or the association of the organisation with the activities of any political party,
by an order published in the official Gazette, specify in this behalf.
(2) (a) Except with the prior permission of the Central Government, no person, resident in
India, and no citizen of India, resident outside India, shall accept any foreign contribution,
or acquire or agree to acquire any foreign currency, on behalf of an organisation referred
to in sub-section (1).
(b) Except with the prior permission of the Central Government, no person, resident in
India, shall deliver any foreign currency to any person if he knows or has reasonable
cause to believe that such other person intends, or is likely to deliver such currency to
an organisation referred to in sub-section (1).
(c) Except with the prior approval of the Central Government, no citizen of India, resident
outside India, shall deliver any currency, whether Indian or foreign, which has been
accepted from any foreign source, to–
(i) any organisation referred to in sub-section (1), or
(ii) any person, if he knows or has reasonable cause to believe that such person
intends, or is likely, to deliver such currency to an organisation referred to in sub-
section (1).
8
Subs. for sub-section (1) by act 1 of 1985, S. 4 w.e.f. 1 – 1 – 1985
160
(1-A) Every association referred to in sub-section (1) may, if it is not registered with the
Central Government under that sub-section, accept any foreign contribution only after
obtaining the prior permission of the Central Government and shall also give, within
such time and in such manner as may be prescribed, an intimation to the Central
Government as to the amount of foreign contribution received by it, the source from
which and the manner in which such foreign contribution was received and the purposes
for which and the manner in which such foreign contribution was utilised by it.]
(2) Every candidate for election, who had received any foreign contribution, at any time
within one hundred and eighty days immediately preceding the date on which he is duly
nominated as such candidate, shall give, within such time and in such manner as may
be prescribed, an intimation to the Central Government as to the amount of foreign
contribution received by him, the source from which and the manner in which such
foreign contribution was received and the porposes for which and the manner in which
such foreign contribution was utilised by him.
161
(e) from his relative when such foreign contribution has been received with the previous
permission of the Central Government:
Provided that no such permission shall be required if the amount of foreign contribution
received by him from his relative does not exceed, in value, eight thousand rupees per
annum and an intimation is given by him to the Central Government as to the amount
received, the source from which and the manner in which it was received and the purpose
for which and the manner in which it was utilised by him;
(f) by way of remittance received, in the ordinary course of business, through any official
channel, post office, or any authorised dealer in foreign exchange under the Foreign
Exchange Regulation Act, 1973 (46 of 1973).
Explanation– In this Act, the expression ‘relative’ has the meaning assigned to it in the
Companies Act, 1956 (1 of 1956).
9
Subs. by Act 1 of 1985, S. 5 w.e.f. 20 – 10 – 1984
10
Subs. by Act 1 of 1985, S. 6 w.e.f. 1 – 1 – 1985
162
Provided that no such prohibition or requirement shall be made unless the Central Government is
satisfied that the acceptance of foreign contribution by such association or person or class of
persons, as the case may be, the acceptance of foreign hospitality by such person, is likely to
affect prejudicially–
(i) the sovereignty and integrity of India; or
(ii) the public interest; or
(iii) freedom or fairness of election to any legislature; or
(iv) friendly relation with any foreign State; or
(v) harmony between religious, racial, linguistic or regional groups, castes or communities.
CHAPTER III
MISCELLANEOUS
Section 12. Power to prohibit payment of currency received in contravention of
the Act–
Where the Central Government is satisfied, after making such inquiry as it may deem fit that
any person has in his custody or control any article or currency, whether Indian or foreign,
which has been accepted by such person in contravention of any of the provisions of this
Act, it may be, by order in writing, prohibit such person from paying, delivering transferring
or otherwise dealing with, in any manner whatsoever, such article or currency save in
accordance with the written orders of the Central Government and a copy of such order shall
be served upon the person so prohibited in the prescribed manner, and thereupon the provisions
of sub-sections (2), (3), (4) and (5) of section 7 of the Unlawful Activities (Prevention) Act,
1967 (37 of 1967) shall, so far as may be, apply to, or in relation to, such article or currency
and references in the said sub-sections to moneys, securities or credits shall be construed
as references to such article or currency.
163
Section 14. Inspection of accounts or records–
If the Central Government has, for any reason, to be recorded in writing, any ground to
suspect that any provision of this Act has been, or is being, contravened by–
(a) any political party, or
(b) any person, or
(c) any organisation, or
(d) any association,
it may, by general or special order, authorise such gazetted officer, holding a 11[Group A
post], as it may think fit (hereinafter referred to as the authorised officer), to inspect any
account or record maintained by such political party, person, organisation or association, as
the case may be, and thereupon every such authorised officer shall have the right to enter
in or upon any premises at any reasonable hour, before sunset and after sunrise, for the
purpose of inspecting the said account or record:
Provided that no gazetted officer shall be authorised to inspect the account or record maintained
by political party, unless he has been holding a 11[Group A Post] in connection with the affairs of
the Union, or a State, for not less than ten years.
11
Subs. by Act 1 of 1985, S. 7 w.e.f. 20 – 10 – 1984
12
Ins. by Act 1 of 1985, S. 8 w.e.f. 20 – 10 – 1984
164
Section 17. Seizure to be made in accordance with the Code of Criminal
Procedure, 1973–
Every seizure made under this Act shall be made in accordance with the provision of section
100 of the Code of Criminal Procedure, 1973 (2 of 1974).
165
Section 22. Penalty for article or currency obtained in contravention of Section 12–
If any person, on whom any prohibitory order has been served under Section 12, pays delivers,
transfers or otherwise deals with, in any manner whatsoever any article or currency, whether
Indian or foreign, in contravention of such prohibitory order, he shall be punished with
imprisonment for a term which may extend to three years, or with fine, or with both; and
notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), the
court trying such contravention may also impose on the person convicted an additional fine
equivalent to the market value of the article or the amount of the currency in respect of
which the prohibitory order has been contravened by him or such part thereof as the court
may deem fit.
Section 23. Punishment for the contravention of any provision of the Act–
(1) Whoever accepts, or assists any person, political party or organisation in accepting,
any foreign contribution or any currency from a foreign source, in contravention of any
provision of this Act or any rule made thereunder, shall be punished with imprisonment
for a term which may extend to five years, or with fine, or with both.
(2) Whoever accepts any foreign hospitality in contravention of any provision of this Act or
any rule made thereunder, shall be punished with imprisonment for a term which may
extend to three years, or with fine, or with both.
Section 24. Power to impose additional fine where article or currency is not
available for confiscation–
Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), the
court trying a person who, in relation to any article or currency, whether Indian or foreign,
does or omits to do any act which act or omission would render such article or currency
liable to confiscation under this Act, may, in the event of the conviction of such person for
the act or omission aforesaid, impose on such person a fine not exceeding five times the
value of the article or currency or one thousand rupees, whichever is more, if such article or
currency is not available for confiscation, and the fine so imposed shall be in addition to any
other fine which may be imposed on such person under this Act.
Section 25. Penalty for offences where no separate punishment has been
provided
Whoever fails to comply with any provision of this Act for which no separate penalty has
been provided in this Act shall be punished with the imprisonment for a term which may
extend to one year, or with fine not exceeding one thousand rupees, or with both.
13
[Section 25-A. Prohibition of acceptance of foreign contribution–
Notwithstanding anything contained in this Act, whoever, having been convicted of any
offence under sub-section (1) of section 23 or section 25, in so far such offence relates to
the acceptance or utilisation of foreign contribution, is again convicted of such offence shall
not accept any foreign contribution for a period of three years from the date of the subsequent
conviction.]
13
Ins. by Act 1 of 1985, S. 9 w.e.f. 20 – 10 – 1984
166
as well as the company, shall be deemed to be guilty of the offence and shall be liable
to be proceeded against and punished accordingly:
Provided that nothing contained in this sub-section shall render such person liable to any punishment
if he proves that the offence was committed without his knowledge or that he had exercised all due
diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act
or any rule made thereunder has been committed by a company and it is proved that
the offence has been committed with the consent or connivance of, or is attributable to
any neglect on the part of, any director, manager, secretary or other officer of the
company, such director, manger, secretary or other officer shall also be deemed to be
proceeded against and punished accordingly.
Explanation– For the purposes of this section,–
(a) “company” means any body corporate and includes a firm, society, trade union or other
association of individuals; and
(b) “director”, in relation to a firm, society, trade union or other association of individuals,
means a partner in the firm or a member of the governing body of such society, trade
union or other association of individuals.
167
foreign source;
(d) the time within which, and the manner in which, a candidate for election should
give intimation as to the amount of foreign contribution received by him at any
time within one hundred and eighty days from the date when he became such
candidate;
(e) the form and the manner in which an application shall be made for obtaining prior
permission of the Central Government to receive foreign contribution or foreign
hospitality;
(f) the manner of service of the prohibitory order made under section 12;
(g) the form and manner in which account or record referred to in section 13 shall be
maintained;
(h) the limits up to which an officer, not below the rank of an Assistant Sessions
Judge, may adjudication of confiscation;
(i) any other matter which is required to be, or may be, prescribed.
(3) Every rule made by the Central Government under this Act shall be laid, as soon as
may be after it is made, before each House of Parliament while it is in session for a
total period of thirty days which may be comprised in one session or in two or more
successive sessions, and if, before the expiry of the session immediately following
the session or the successive sessions aforesaid, both Houses agree in making any
modification in the rule or both Houses agree that the rule should not be made, the rule
shall thereafter have effect only in such modified form or be of on effect, as the case
may be; so, however that any such modification or annulment shall be without prejudice
to the validity of anything previously done under that rule.
168
Foreign Contribution (Regulation) Rules, 1976
(Forms not included)
In exercise of the powers conferred by section 30 of the Foreign Contribution (Regulation) Act,
1976 (49 of 1976), the Central Government hereby makes the following rules, namely-
Rule 2. Definitions–
In these rules unless the context otherwise requires,–
(a) “Act” means the Foreign Contribution (Regulation) Act, 1976;
(b) “Form” means a form appended to these rules;
(c) “Section” means a section of the Act.
14
[(d) “Year” means the accounting year commencing from 1st day of April and ending on
31st day of March of the next Calendar year.]
169
(b) foreign contribution by a candidate for election, referred to in sub-section (2) of
section 6 shall be given in Form FC-4, within fifteen days from the date on which
he is duly nominated as a candidate for election;
(c) any scholarship, stipend or any payment of a like nature, from any foreign source
in relation to which an intimation is required to be given under sub-section (1) of
section 7, shall be given in Form FC-5, within thirty days of receipt of such
scholarship, stipend or other payment of a like nature:
Provided that where the person receiving the scholarship, stipend or any payment of a like nature
is residing outside India, the intimation shall be given within sixty days from the date of receipt of
such scholarship, stipend or other payment of a like nature;
(d) foreign hospitality, referred to in proviso to section 9, shall be given on plain paper
within thirty days from the date of receipt of such hospitality specifying the particulars
as to the receipt of such hospitality and the source from which and the manner in
which such hospitality was received.
19
Ins. by GSR 755-E dt. 5-11-1984 w.e.f. 5-11-1984
170
on, or is known to have last carried on, business, or personally works for gain, or is
known to have last worked personally for gain, and in case the person is an organisation
or an association, on the outer door or some other conspicuous part of the premises in
which the office of the organisation or association is located, or is known to have been
last located, and the written report whereof should be witnessed by at least two persons.
Rule 9. Limits up to which an officer, not below the rank of an Assistant Sessions
Judge may make adjudication of confiscation–
An officer referred in clause (b) of Section 19 may adjudge confiscation in relation to any
article or currency seized under Section 16, if the value of such article or the amount of
such currency exceeds one thousand rupees but does not exceed fifty thousand rupees.
20
Subs. by S. O. 860 (E) w.e.f. 29-12-1977
21
For “January” vide GSR 179 (E) dt. 25-3-1991 w.e.f. 1-4-1991
22
Subs. vide GSR 179 (E) dt. 25-3-1991 w.e.f. 1-4-1991
23
Subs. for “sixty days” vide GSR 592 (E) dt. 27-12-1996
171
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