Relatives on Board

Posted on April 13, 2015 by SRRF

Is there any rule under FCRA Act which prohibit relatives to be the part of an Executive Board Committee of an NGO/Society/ Charitable Organisation/ Trust. Am looking for details in this regard.

Ambreen Khan (Ms.)

This entry was posted in FCRA, TAX, LEGAL. Bookmark the permalink.

7 Responses to Relatives on Board

  1. Ranjit kumar jha says:
    April 17, 2015 at 11:41 am

    i agree with Ambreen. if trustee is blood relative and closely related the department view that the organisation is for personal gains not for charitable purpose.

  2. S.S.Shiva says:
    April 17, 2015 at 6:36 am

    Dear Ambreen,

    Although FCRA laws do not specifically prohibit relatives on the Board, the enquiry officers specifically ascertain whether there are inter-relationship within the Board members and do not recommend such cases for FCRA registration, as they apprehend manipulation of funds received or family use of fund in such cases. As Mr.Chandrasekaran has mentioned, it is ethically proper to have only non-related members, especially if there are more than one relative in the Board.

  3. Rajesh Arya says:
    April 16, 2015 at 2:17 pm

    Hi Ambreen:

    For your corporate compliance, you might like to have conflict of interest and disclosure statements signed off by trustees/directors/members.

    Thanks,

    Rajesh

  4. V.B.Chandrasekaran says:
    April 16, 2015 at 12:19 pm

    Hope we should go beyond academic side of a particular issue. In my view, it is good to avoid relatives on board and vulgar to have more than one. Such unethical acts make us vulnerable. Why not we as Voluntary Organisations syntheise a broad frame-work on our self governed ethics and ask government to follow us.
    If it is Trust formed with family funds as core, we could have couple of family members.

    Regards,
    V.B.Chandrasekaran, Chatti Mahatma Gandhi Aashramam,
    Chatti Post, Chinthur Mandal, East Godavari District,
    Andhra Pradesh, Pin Code: 507129.
    Email: verivaan2049@yahoo.com antarbharatid2010@gmail.com;
    Mobile: +919490109328 +918297976970.

  5. B V Soma Sastry says:
    April 13, 2015 at 9:40 am

    Dear Ms. Ambreen,

    There is no rule that prohibits relatives from being on the board of charitable organizations. There are certain restrictions on having foreigners on the board of NPOs.

    Thanks and regards,

    B V Soma Sastry

    • Ambreen Khan says:
      April 14, 2015 at 8:06 am

      Thank you for your response!

      Does an organization with relatives on board say Brother- Sister, Brother-Brother, Husband-Wife is permitted to receive Foreign Funds? Does FCRA law permits the same? Can such organization get registered under FCRA.

      Thanks & Regards
      Ambreen Khan

      • Subhash Mittal says:
        April 17, 2015 at 8:31 am

        Dear Ambreen,

        I feel your original query has been well answered by SRRF Dialogue members. While there is no bar under FCRA rules, etc. However we all know that FCRA Dept takes a number of decisions even outside these rules & regulations. My suggestion is that your Board must include a few un-related trustees, because if all trustees are blood-relative or closely related, the Dept may form the view that the organisation is for personal gains and not for charitable purposes.

Comments are closed.