Dear Members of the SRRF dialogue group,
There is one NGO “Computer Shiksha” based in Gurgaon who collect old / used computers which they retrofit (if necessary) and place in Govt schools for providing Computer education to students coming from the financially weak backgrounds.
They have an excellent track record and have now been adding hundreds of students each month.
One MNC organization is considering donating old computers to them.
They want to know whether there would be any issue as they do not hold an FCRA certification.
Kindly advise.
Thanks & Regards,
MBL Bhargava
Trustee Letz Dream Foundation
We want computers and financial help.
Why can there not be multiple tripartite agreements between the donor, facilitator and recipient? It would help get rid of any confusions, at any later stages. The GOI retains all the rights to challenge any transaction at any time beause of loosely written laws, including but not just limited to , acts, rules and explanatory notes, so why not mitigate that risk forever?
additionally as mentioned as above
FCRA provisions would be attracted , if MNC ( foreign company) Donate Computers directly to Indian NGO on the donation point of view one side and if these computers are further donated to needy students then this distribution will be a part of Charity / Charitable activities and eligible for application of income u/s 11 of the Income tax act. both ( MNC and Indian NGO) would show this transaction in their Books of account.
FCRA is related to donation by way of cash / Cheque / Demand Draft from foreign source / currencies.
Getting a donation from a MNC , if the NGO is just facilitating without any reflrctions in their books there is nothing to worry about. The NGO needs to hve the proper documentation in place to substantiate the facilitation.
All donations whether in currency / remittance or in kind come within the ambit of FCRA.
If the MNC is having its any office in India and that Indian entity donates then there is transfer from within Indian and thus not to attract FCRA provisions.
I agree with argument of Anil Jain, that with amendment in definition of Foreign Source, most companies registered in India would come out of the definition of FCRA. Hence ‘Computer Shiksha’ NGO could receive these computers and further distribute the same to students.
If donation is MNC’s permanent establishment established in India then the donation is from within India thus not to attract FCRA provisions. Otherwise if donation to come from outside India, certainly FCRA provisions will have to be complied with.
If donation is from MNC’s PE in India then donation is from within India and not attracting FCRA provisions.
The case is one of receipt in kind, which the NGO hands over to schools. It is no way an income to the NGO. They need not make any entry in their assets register and if they simply serve as a conduit to pass on used computers to deserving poor students education in government schools, then I think there is no need to htttthFCRA