Socio Research & Reform Foundation

Dear Sirs,

We are an organisation in MP working on healthcare. We have a donor which was not classified as a foreign company and as per the company’s directive we have been considering this money to be indian money.

We now have a confusion when while reviewing the New Companies Act wherein the subsidary company seems to become a foreign entity due to the shareholding pattern of holding company. Our donor is the subsidary company.

therfore the following are our queries

1. are all the funds that we have received since 1/4/2014 classified as foreign donation under FCRA???
2. if they are considered foreign donation and we have fcra but have not deposited this money in fcra account, what are the consequences?
3. what is the corrective action that can be taken?

regards

Abhishek

Integrated Application for Registration, Prior Permission and Renewal

1. One integrated form prepared for FCRA registration, Prior permission and Renewal. Till now one had to use different forms for each of these activities, FC3 for registration, FC4 for prior permission and FC5 for renewal, now an integrated form FC3 has been drafted.
2. Now printed copy of form not to be submitted, instead applications need to be Digitally Signed just like as in Income Tax and Companies Act. All documents required to be submitted in hard copies would now be scanned and submitted alongwith these applications.
3. Fee would need to be paid online through electronic gateway.

Declaration on web-site

4. All NGOs granted registration / prior permission would need to post Audited FCRA Accounts would need to be posted on their websites.
5. Any foreign contribution received would need to be displayed within 7 days of receipt on website.

Annual Return

6. From now on even annual return (FC6 till now) will no longer need to be filed in printed copy and only Digitally Signed copy would need to be filed alongwith all supporting documents. Time limit still remains of 31^st

Requirements from Bankers

7. All bankers have to inform within 48 hours Central Govt. about receipt of any foreign contribution by any ‘person’ who receives such contribution but till date does not have registration / prior permission. In previous rules this was 30 days.
8. Bankers are also required to inform within 48 hours the central govt. all remittances received by FCRA registered or having prior permission in their designated or utilization bank accounts.

Changes in Forms

9. Earlier there were 10 forms (FC1-FC10), these have now been reduced to 7 (FC1-FC7). As mentioned above Form for Registration (FC3), Form for Prior Permission (FC4) and Form for Renewal (FC5) all have been merged in a new form FC3. Also earlier forms for articles (FC7) and securities (FC8) have been merged into one form FC5. Consequentially all other forms have been renumbered in sequential order.

Changes in these forms are highlighted as below:

FC1 (new Form No. FC1): Intimation of receipt of FC by way of gift from relative.

• No change except details like e-mail, mobile nu., address etc. now sought.
• Still to be submitted in a printed copy.
• Normally to be submitted by an individual.

FC2 (new Form No. FC2): Prior permission for receiving hospitality

• Normally to be submitted by persons covered under S. 3, (legislature, Govt employees, judges, etc.) who are likely to visit abroad and accept foreign hospitality
• Certain changes made in the form but seem more a case of drafting error, as details of organisation, which will provide hospitality seem to have been left out.

FC3  – earlier only covered registration (new Form now covers registration / prior permission / renewal)

• Very strange now the form requires details of facebook page and twitter handle of the chief functionary
• Now alongwith details of Chief Functionary and executive members/ office bearers, details of Chief Patron are also requested.
• In case any of the persons whose details have been provided is a foreign citizen, following additional details are requested:
  • Place of Birth
  • Passport No.
  • Permanent address in foreign country
  • If a person of Indian origin, then details of OIC/PIO card,
  • If resident in India, from when,
  • In case of above persons details of any positions held in any other NGO
  • Details also asked for organisations which have been granted prior permission / registration and are a unit / branch / associate of the organisation applying.
  • Has been prohibited under S. 10 or asked to obtain prior permission under S. 9(d).
  • Details of designated / utilization accounts being asked.
  • Q 13 asks for details of foreign sources both individuals as well as organisations from whom the foreign contribution is proposed to be received. Most likely this is applicable in case of prior permission where sources are known. However the Form does not mention that this information is not required in case of Registration cases.

FC4  – for annual return (earlier FC6)

• Prior permission return earlier used to go manually, now this will have to go online.
• Facebook page and twitter handle details of the chief functionary to be given here too.
• Total number of employees to be disclosed – This could pose problem as many NGOs are not registered for PF & ESI
• It is also asking donor wise details of foreign / local source. Rather perplexed, if a donor is a local source, then it should not appear in FCRA return in any case ?
• Now project details are also required along with address of implementation. Now amount has to be given address-wise.
• Details of administrative exps. asked for. Earlier no details were required.
• Branch office details to be provided
• Details of Designated as well as Utilisation Bank Accounts also required to be disclosed
• Details of closing balance not asked for.
• Now Chief Functionary has to declare that FC has not been used for (i) detrimental to national interest, (ii) not likely to affect prejudicially public interest, (iii) not likely to affect prejudicially security, strategic, scientific or economic interest of the State and any matters connected therewith or incidental thereto.
• Many changes in List of purposes to be discussed separately.

__________________________________
Socio Research & Reform Foundation (NGO)
512 A, Deepshikha, 8 Rajendra Place,
New Delhi – 110008

FCRA Department is going to organize monthly meeting  to redress the grievances related to FCRA registration/prior permission. This meeting will be held by Director (FCRA) with genuine representatives of the associations at Room No. A-104/1, 1^st Floor, NDCC-II Building, Ministry of Home Affairs, Jai Singh Road, New Delhi – 110001 on 5^th day of every month.

Associations wishing to attend the said meeting may send their request on e-mail address “ravinder.prasad56@nic.in” mentioning name & address of the association, name of the person desirous to attend the meeting, application number, issues for discussions etc. (click here for related circular)

Hope this information will be useful to those association facing problem in grant of registration/prior permission.

Ramanuj Maurya
Coordinator
__________________________________
Socio Research & Reform Foundation (NGO)
512 A, Deepshikha, 8 Rajendra Place,
New Delhi – 110008

Couple of questions –

– Can a FCRA “Grant” be used for “sub-contacting” with an international for profit or not for profit entity, after complying with TDS and service Tax requirements? This could be a FTS contract.

– Can a local “Grant” be used for “sub-contacting” with an international for profit or not for profit entity, after complying with TDS and service Tax requirements? This could be a FTS contract.

​Thanks,

Rajesh​

—
RAJESH ARYA :: OPERATIONS DIRECTOR
JOHN SNOW INDIA PRIVATE LIMITED
B-6-7/19, SAFDARJUNG ENCLAVE,
DDA LSC, NEW DELHI – 110029, INDIA