FCRA Registration Enquiry details are as follow-
1. Is FCRA regulated by Reserve Bank of India (RBI)?
Ans. FCRA is internal security legislation and it is not regulated by RBI. It is regulated by the Ministry of Home Affairs, Government of India.
2. Is Foreign Exchange Management Act (FEMA) also applicable to foreign contribution received by Indian NGO?
Ans. FEMA is a fiscal legislation coming under the Ministry of Finance, Government of India. It does not apply to foreign contribution received by Indian NGO
3. Is it necessary to have registered NGO in order to get FCRA registration?
Ans. Section 2(1)(a) of FCRA defines the term association as : “ association” means an association of individuals, whether incorporated or not, having on office in India and includes a society, whether registered under the Societies Registration Act, 1860 (21 of 1860), or not, and any other organisation, by whatever name called ; The Act does not specify registration as a condition precedent to for the purposes of this act. It is not necessary for an association to be a registered one but there must be some documentary evidence to establish the existence and activities of the association. But for all practical purposes registration is a defector necessity.
4. Is it necessary to obtain registration under Section 12A of the Income Tax Act in order to apply for registration under FCRA?
Ans. The FCRA does not specify registration under the Income Tax Act as a condition precedent for registration under FCRA. Infact, there are numerous instances of organisation having FCRA registration with Income Tax registration. But, since Income Tax registration is mandatory in nature, ideally Income Tax registration should be completed before applying for FCRA registration.
5. What are the different forms of registration possible under FC(R)A to receive Foreign Contribution?
Ans. There are two ways of registration possible under FC(R)A
1) Regular registration (Apply in Form F.C 8) under this registration, there is no restriction (either the total amount or from specific donor) for receiving Foreign Contribution.
2) Prior permission (Apply in Form F.C 1A) under this registration, the permission is granted for a specific amount from a specific donor. A letter of intent from the donor to donate the amount must be enclosed along with the application form (Form F.C 1A).
However, in both the above cases, it is imperative to file the annual return in Form F.C 3.
6. Are donation received in kind considered as foreign contribution?
Ans. The definition of the term ‘foreign contribution’ is wide enough to include donations received in kind. The definition of ‘foreign contribution’ says that any donation, delivery or transfer made by any foreign source, of article, currency or foreign security.
7. Will the consultancy income of an NGO be considered as foreign contribution?
Ans. The definition of ‘foreign contribution’ includes all kinds of foreign receipts. It does not distinguish between a commercial receipt or a voluntary contribution. Therefore, the consultancy income should also be considered as foreign contribution. The intent of FCRA is to regulate the foreign receipts of certain specified association and individuals irrespective of the nature of receipt, unless it is specifically excluded in FCRA.
8. Will donations received in Indian rupees in India from a foreigner be considered as foreign currency?
Ans. Yes, money received from a foreign source, whether in India or outside India, whether in Indian currency or foreign currency is considered as foreign contribution.
9. Will funds received from an NRI in foreign currency be considered as foreign contribution?
Ans. NRI's are not covered within the definition of ‘foreign source’. Therefore, any amount received from NRI will not be considered as foreign contribution.
10. Will United Nations or World Bank be considered as foreign source?
Ans. No, Central Government has notified in the official gazette that agencies of United Nations and certain other international organisations shall not be treated as foreign source, for the purposes of the Act.
11. Can political parties receive foreign contribution?
Ans. FCRA specifically debars political parties from receiving foreign funds. Political parties cannot receive foreign fund under any circumstances. Neither can they apply for registration nor can they apply for prior permission on casetocase basis.
12. Which are the organisations/individuals specifically debarred from receiving foreign contribution?
Ans. Section 4 of FCRA specifies that the following persons cannot receive foreign contribution:
(a) candidate for election.
(b) Correspondent, columnist, cartoonist, editor, owner, printer or publisher of a registered newspaper.
(c) Judge, Government servant or employee of any corporation.
(d) member of any legislature
(e) Political party or officebearer thereof.
The above mentioned persons cannot receive foreign contribution subject to certain exceptions specified in section 8 which are as under:
(a) If they receive foreign funds by way of salary, wages or remuneration for services rendered.
(b) If they receive payment in ordinary course of business transaction in India by such foreign organization or source.
(c) If the funds are received in the course of international trade or commerce or in the ordinary course of business transacted outside India.
(d) Payment is received as an agent of a foreign source of organization in relation to any transaction made by such foreign organization with the governance.
(e) If the payment is received by way of gift or presentation as a part of any Indian delegation within the norms of acceptance described by Central Government.
(f) Payment is received from relative staying abroad. Such payments should be received with prior permission only if it exceeds Rs.8, 000.00.
(g) Payment is received through official channel, post office or any authorized dealer in the ordinary course of business”.
13. Can an organisation of political nature receive foreign contribution and register itself with FCRA?
Ans. Organisation of Political nature is not eligible for registration under FCRA. However such organisation can apply for prior permission on casetocase basis. An organisation of political nature is an organisation which is associated or close to political parties. The Central Government has published a list of organisations which are considered as organisation of political nature.
14. Does FCRA apply to ordinary citizens?
Ans. Apart from the persons mentioned in Section 4 (as discussed above) all individual are entitled to receive foreign funds without any restrictions. In other words, FCRA is not applicable to private individuals. The only exception in this regard is receipt of stipend or scholarship from foreign source in excess of Rs.36, 000.00 should be reported to Central Government by virtue of Section 7.
15. Does FCRA apply to commercial or business organisation?
Ans. Movement of foreign funds in the normal course of commerce and business is outside the purview of FCRA. Therefore, business organisation need not worry about FCRA as FCRA is only a internal security enactment. However, the provision of Foreign Exchange Management Act, 1999, which is a financial legislation, would be applicable.