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The NGOs cannot take foreign contribution directly.
For this purpose they should be registered under the
Foreign Contribution Regulation Act 1976, commonly known
as the FCRA.
There can be two types of contribution from the
foreign source, i.e. one time or expected more than once and
even regularly. For any one time contribution the NGOs can
receive the amount by seeking prior permission of the FCRA
Section of the Ministry of Home Affairs, Government of
India; whereas for multiple and regular contributions of the
foreign source it is advisable to seek permanent
registration from the said Ministry.
For this purpose an application is to be made by the
NGO, which should be in working for at least three years
after its due registration, to the Secretary to the
Government of India, ministry of Home Affairs, 26 Mansingh
Road, New Delhi – 110003 in the prescribed Form FC-8 along
with the desired enclosures (Certificate of Registration,
Memorandum and Rules or the Trust Deed or any other proof of
registration, audited financial statement and activity
report of the least three years, and if possible letter of
the prospective donor.
The Ministry sends the accepted application to local intelligence people
for verification of the credentials and records of the organisation. On
their positive remarks, the FCRA Section of the Ministry issues the
Certificate of Registration to the applicant organisation.
It is essential to receive foreign contribution only
in one designated bank account. Therefore, the applicant organisation
should open a fresh bank account with the intention to operate it for
such funds and mention it in the application. The said Ministry will
directly inform the concerned bank to keep watch on the use of the
foreign contribution and report back to the Ministry in case of any
discrepancy.
The organisations registered under the FCRA have to
maintain separate accounts incurred under the FC head and submit a
return in the prescribed format to the Ministry along with the audited
statement of accounts of the previous year by 31 July every year.
The organisations registered under the FCRA, should
inform to the Ministry about any change in name of the organisation, its
Registered Office and aims and objects within 30 days of the applicable
change. Similarly, prior permission will be required from the said the
Ministry for any change in the designated bank or replacement of more
than half of members of the governing body at the time of its
registration under the FCRA.
The management should be well aware of various
provisions of the FCRA and should strictly follow the same otherwise
they may face a number of rigorous punishments under the Act.
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