Should NGOs join hands with Private Banks in their CSR efforts?

In our Country, major Banks in Private sector like ICICI, AXIS and HDFC have been in News for wrong reasons. MNBanks like HSBC have also been in the news for wrong reasons. Is it true that the Regulators cast a blind eye on them? Should NGOs join hands with them in their CSR efforts? Are our Regulators regulating themselves in favour of erring Banks !

Udayashankar

Sheila Bair: Regulators Let Big Banks Look Safer Than They Are
Capital-ratio rules are upside down—fully collateralized loans are considered riskier than derivatives positions.
(In critical areas such as the ones discussed by Sheila Bair in the context of USA, Indian Regulators seem to be doing a good Job. Is it not?)
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Transfer of Assets u/s 35AC

Dear Sir,

We are having exemption u/s 35 AC for specific one project. We want to know after completion of the project can we transfer asset from project to the organization?

Regards,

Sushma Bhonsale
Head – Accounts
Deepak Foundation
Within Nijanand Ashram Premises,
Nr. Laxmi Studio, Adjoining L&T Knowledge City,
On NH-8, Ta. & Dist. Vadodara-390 019

Posted in FCRA, TAX, LEGAL | 4 Comments

Workshop & FCRA

My Query is:

If a NGO organize a workshop with the help of foreign organisation and the funds that comes through them in NGO’s bank (which has no FCRA) Will it be considered as a donation?

The foreign organisation has these funds as a grant from their country to conduct programmes in other countries.

Richa Mohan

Posted in FCRA, TAX, LEGAL | 10 Comments

Challenges of implementing of RTE

Right to Education is creating its own problems. As the Govt’s sustained campaign to enhance attendance in schools is bringing over 90% of children to schools, predictably it is also creating infrastructural problems. At primary level currently there are 5.23 lakh of vacancies. This would almost double, i.e. another 5.1 lakh vacancies, if the Govt decides to implement the RTE norm of 30 students per teacher.

Not only this the standard of teachers currently employed are not as per norms set out. Presently 7.74 lakh teachers do not have necessary qualification or training. In fact present criteria for qualification for primary teachers is having passed Teachers’ Eligibility Test. To be eligible to sit for this examination, one needs to have passed XIIth examination and undertaken a 2 year diploma in Teachers’ education, however most states are finding it extremely difficult to get teachers with such qualifications. In fact WB Govt appoints teachers with Xth pass (Refer earlier blog post on SRRF Dialogue http://blog.srr-foundation.org/?p=424 ).

The problem is not limited to primary level, at secondary level, Rashtriya Madhyamik Shiksha Abhiyan requires 1.79 lakh new teachers for English, Mathematics and science. The problem is getting further accentuated since the institutes providing Teachers’ Training has capacities of less than 30,000 per annum.

The issue is not just limited to shortage of teachers, there are constraints of space, several states are allowing schools to add floors to present buildings of schools. Refer earlier post on SRRF Dialogue on this subject http://blog.srr-foundation.org/?p=501 .

Let us all recognize that Govts (both at central level as well as at state levels), education authorities, school administrations are all facing huge challenges in complying with RTE, let all of us work together to ensure that future generations of India are not only literate but well educated.

______________________________________
Socio Research & Reform Foundation
(A Non Government Organisation)
512 A, Deepshikha, 8 Rajendra Place, New Delhi – 110008
e-mail: socio-research@sma.net.in;

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Debt as FC

Dear Friends,

Greetings from CWS!

I have a query on debt. The query is:

  1. Can a secured or an unsecured debt be treated as FC money?
  2. If yes, under what circumstances?

Thanks and regards,
_____________________________________
B V Soma Sastry
Director – Finance and Admin
Centre for World Solidarity
12-13-438, Street No. 1, Tarnaka
Secunderabad 500 017
Andhra Pradesh

Posted in FCRA, TAX, LEGAL | 1 Comment

Transfer outside India

Dear All,

Greetings from CWS, Hyderabad!

While I was browsing the website of SRRF, I came across a presentation which had the following 4 points.

  1. Grants to NGOs outside country
  2. Grants to sister concerns outside country
  3. Payment for procurement of goods / services from outside India
  4. Payment for travel expenses of Indian Board members / staff

In case of 1 and 2, I seek some clarity from all of you. If grants are given to organizations outside India:

  1. How do we account the grant?
  2. Will the auditor in India take cognizance of the audit report of outside country and audit our books? This is important in the context that most of donor agencies are seeking audited report on actual expenditure although IT Act allows the grant to be treated as expenditure.
  3. 3 establishes a vendor-vedee relation but in case of consultancy:
    • What should be done for TDS? Can we deduct TDS and if yes, how do we deposit to the exchequer?
    • Can the consultant claim TDS upon filing of returns in his home country?
  4. I am not seeing problem in 4 as it amounts to more or less a reimbursement of expenses and would attract certain provisions of IT and RBI.

Kindly comment on the issue for further clarity.

Thanks and regards,
_____________________________________
B V Soma Sastry
Director – Finance and Admin
Centre for World Solidarity
12-13-438, Street No. 1, Tarnaka
Secunderabad 500 017
Andhra Pradesh

Posted in FCRA, TAX, LEGAL | 2 Comments

Query Related to FCRA Registration

Dear dialogue member,

We are a delhi based NGO. We have to apply for FCRA registration but our problem is one of our board member is away from Delhi for one year. He is doing MBA there. If we apply for registration whether it will be rejected on this ground or matter may get delayed due to police varification. Whether police verification will be done in both the places- Delhi and Ranchi?

Regards,

Yogendra Jha

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SEWA Bank – An All Women Bank has been functioning for almost last 30 years

Finance Minister in his Budget has proposed launch of an all Woman Bank in public sector. Perhaps, he may want to consult SEWA Bank, an all women bank serving women customers. It has been functioning since 1974.

The Bank works as a cooperative and has around 200 women employees. It has seven branches in and around Ahemdabad and Gandhinagar serving around 4 lakh women, mostly small vendors and daily-wage workers. Women can open a bank account with as little as Rs 5/-. The Bank promotes regular savings among the women, however small. Apart from traditional banking services, it has innovated by offering insurance solutions for life, health, natural calamity, accident, death in the family, widowhood, etc. If the customers opt for it, interest from FD is sent directly as premium for the insurance policy. The bank has developed an innovative concept of Saathi, who is regularly in touch with women customers. She is critical in ensuring proper communication with women and ensuring loan installments are paid on time among other activities. It has almost 100 saathis.

Bank has a share capital and reserves of Rs 40 crores, beside a balance of Rs 200 crores. It has recently introduced Core Banking System. It has ambitions for expansion. It plans to open branches across Gujarat and would like to be linked to 10,000 ATMs for its debit cardholders. For more information you may visit its website http://www.sewabank.com.

~ Based on a recent article in Indian Express

__________________________________
Socio Research & Reform Foundation
(A Non Government Organisation)
512 A, Deepshikha, 8 Rajendra Place, New Delhi – 110008
e-mail: socio-research@sma.net.in; website: http://www.srr-foundation.org

Posted in General | 2 Comments

Query – FCRA Bank Account

Respected Sir,

I draw your kind attention towards query we have faced regarding FCRA Project Account.As per the new act organization should open a multiple account under main fcra designated bank account to utilise fc money for relevant project and within 15 days organization have to intimate MHA (FCRA devision) for opening a new bank account but we have not received any correspondence regarding this account from MHA. Now query We received Fc fund in our Main FC account and than transfer money to our project account. and from project account we transfer money to our partner who have FCRA registration and they have to show this money in their FC Designated bank account first and than they transfer that amount to their project account but one of our partner received complain from their bank that the amount receive in his account must be from Fc Designated bank account only. So there is any clause regarding this issue to solve the problem.

Regards,

Bhavesh Soni
Sahjeevan
175, Jalaram Society,
B/h. Vishwamangal Appt.
Vijay Nagar,
Bhuj 370 001. Kutch

Posted in FCRA, TAX, LEGAL | 3 Comments

Bankers reluctant in allowing NGOs to open e-Payment Gateways

Recently a case came to light where an NGO who had an e-payment facility on its website was asked to shut down the same. When the matter was taken up with the Banker, it was stated that since the NGO was receiving frequent remittances through this facility, the banker was not comfortable if these payments were complying with FCRA provisions. Therefore to be on safer side they asked the NGO to provide all documentation to confirm if provisions of FCRA as well as Income Tax had been complied with. In the meantime they blocked receipt of funds through e-payment facility.

The above incident shows that NGOs face all kind of prejudices and are not being allowed to use the facilities which bankers have no problems giving it to their business customers.

Have you faced any similar or other problems while dealing with your bankers? Please let us know, if considered appropriate we may contact NGO representative organisations to have meetings with the bankers.

We thank CA Shri Deepak Bansal for bringing this information to the editorial team’s attention.

______________________________________
Socio Research & Reform Foundation
(A Non Government Organisation)
512 A, Deepshikha, 8 Rajendra Place,
New Delhi – 110008
e-mail: socio-research@sma.net.in

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