FCRA REGISTRATION: I. Registration

Transcription

1 FCRA REGISTRATION: Foreign contribution can be received only by such associations which are carrying out definite cultural, economic, educational, religious or social programmes. There are two modes of obtaining permission under FCRA: Registration- Regular registration (Apply inform F.C 8) - under this registration, there is no restriction (either the total amount or from specific donor) for receiving Foreign Contribution. Prior Permission - 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). I. Registration Application for grant of registration to accept foreign contribution are to be made to the Ministry of Home Affairs in prescribed form FC-8, which can be down loaded from MHA s website On receipt of the application, the same is processed by the MHA as per the provisions of Act and guidelines issued for grant of Registration. The registration is granted only to such associations which are doing genuine work in their chosen field of activity and are clear from security angle. The normal time taken for final disposal of an application is about four months for the associations, which are not able to furnish verification certificate from Collector of the concerned District or other officers not below the rank of Deputy Secretary of the concerned Department/Ministry in the State Government/Central Government. The associations, which submit the verification certificate on prescribed format, are granted registration within a fortnight of submission of the application. Once registration is granted, the association may receive foreign contribution from any foreign source and it is required to furnish annual returns regarding receipt and utilization of foreign contribution to the Ministry of Home Affairs

2 (Foreigners Division) on the prescribed FC-3 form duly certified by a Chartered Accountant. This must be submitted before 31st July of the following financial year. II. Prior Permission Application for grant of Prior Permission (PP) can be submitted in prescribed form FC-1A to the Ministry of Home Affairs, which can be down loaded from Ministry of Home Affairs website. For this a commitment letter from the donor foreign source for funding specific project/scheme is mandatory to be submitted along with the application form. On receipt of the application, the same is processed by the Ministry as per the provisions of Act and guidelines issued thereunder. Prior Permission is granted to such associations which are new or in formative stage but are carrying out some programmes in the area of cultural, economic, educational, religious or social field of activities. The normal time taken for final disposal of an application is about 3 months (extendable to four months) for the associations, which are not able to furnish verification certificate from Collector of the concerned District or other officers not below the rank of Deputy Secretary of the concerned Department/Ministry in the State Government/Central Government. For the associations which submit such verification certificate, Prior Permission is granted within a fortnight of submission of the application. Once Prior Permission is granted, the association may receive foreign contribution from particular foreign source for particular purpose within a reasonable time limit. In such cases donor and donee are specific and amount of FC receipt can be utilized for the particular purpose only for which the permission has been sought. Such associations are required to furnish annual returns regarding receipt and utilization of foreign contribution to the Ministry of Home Affairs (Foreigners Division) in prescribed FC-3 form duly certified by a Chartered Accountant. This has to be submitted before 31st July of the following financial year. If during a particular financial year, an association applies for Prior Permission for second or subsequent time, it is required to furnish details of receipt and utilization of foreign contribution received earlier.

3 Common Grounds for Rejection of Applications Application for FCRA registration can be filed any time after registration of the organization, but the organization with a considerable past history of activities have a greater chance of convincing the FCRA authorities with regard to genuineness and the relevance of their purpose. Organizations desirous of registering themselves with the FCRA department are required to apply in form FC 8 along with various documents. The FCRA department may ask the intelligence bureau for a report on which FCRA department decides whether to accept or reject the application. The FCRA department issues a registration certificate and provides a permanent registration number, which is required to be quoted in all future correspondence and filing of returns and forms. Under certain circumstances application for registration will be refused if it affects the sovereignty and integrity of India. To remove certain lacunae noticed during administration of the FCRA and the Rules made thereunder, certain guidelines were laid down for considering applications for grant of prior permission/ Registration under the Act. Some of the common grounds for rejection of applications are enlisted below as illustrations to bring in transparency and benefit the applicants in taking due care and caution:- If the association is not registered under the Societies Registration Act, 1860 or the Indian Trusts Act, 1882 or section 25 of the Companies Act, If any of the office bearers/trustees, including the chief functionary is a foreign national, other than of Indian origin. If the association has a single office bearer/member. If the association is found to have been formed for personal gain or for diversion of the funds for undesirable purposes. If the association is found to be fictitious or benami in nature. If the credibility of any member of the governing body is in doubt.

4 If the association has close links with another association which has been refused registration under FCRA or prohibited under FCRA or violated the provisions of FCRA. If the association has links with any banned organizations. If the principal office bearers of the association have been convicted by any court of law under any act or if a prosecution for any offence is pending against them. If the principal office bearers of the association have been found guilty of diversion or misutilisation of funds of the said association or any other association in the past. If the activities of the association are found to be aimed at conversion through inducement or force, either directly or indirectly, from one religious faith to another. If the association is found to propagate sedition or to advocate violent methods to achieve its ends. If the association is found to be creating communal tensions or disharmony. If the office bearers of the association are also office bearers of another association and one of these associations has come to adverse notice. If the association s printed work is not certified by the Press registrar of India not to be a newspaper in terms of section 1(1) of the Press Registration of Books Act, If the source of foreign contribution is found to be adverse to the interests of the country. If the acceptance of foreign contribution by the association is likely to be prejudicial to (a) the sovereignty and integrity of India; (b) free and fair elections to any Legislature or House of Parliament; (c) public interest; (d) friendly relations with a foreign state; or (e) harmony between any religious, social, linguistic, regional groups, caste or community.

5 If the association has not filed its annual FC-3 returns, of receipt and utilization of foreign contribution received with prior permission, within the stipulated period. If the association has violated any provisions of the Act or Rules in the preceding three years and the said violation has not been remedied or rectified I. 1. Additional grounds for rejection of applications for Registration. If the association is not in existence for three years at least. If the association has not carried on any activity in its chosen field during the last three years. If the association has not received foreign contribution, with prior permission, during the preceding three years. If the association has not made any substantial contribution, excluding expenditure on administration, (Rs.6,00,000 over a period of three years or Rs.2,00,000 per year) in its field of interest. II. 2. Additional grounds for rejection of applications for Prior Permission If the application is not accompanied by the commitment letter of the donor. If the application is not accompanied by the copy of project for which foreign contribution is solicited/is being offered. Illustrative activities permitted to be carried out by associations having different nature Associations having definite cultural, economic, educational, religious or social programme can accept foreign contribution only after obtaining either prior permission or registration from the Central Government. Following are illustrative but not exhaustive list of activities which are permissible and can be carried out by associations of different nature : 1. Religious

6 Celebrations of religious functions/festivals etc. Construction/repair/maintenance of places of worship, religious schools. Education of priests and preachers; (dissemination of the message of good will etc. from the holy books). Publication and distribution of religious books/ literature. Maintenance of priests / preachers / other religious functionaries. Any other activities related to the above. 2. Educational Construction and maintenance of schools/colleges. Construction and running of hostels for poor students. Grant of stipends/scholarships/assistances in cash or kind to poor/deserving children. Purchase and supply of educational material-books, notebooks etc. Conducting adult literacy programs. Conducting Research. Nor-formal education/schools for the mentally challenged. Non-formal education projects/coaching classes. Any other activities related to the above. 3. Economic

7 Following but not being commercial or profit making activities Micro-finance projects, including setting up banking co-operatives and self-help groups. Self-sustaining income generation projects/schemes. Agricultural activities. Rural development programmes/schemes. Animal husbandry projects. REGISTRATION PROCESS UNDER FCRA Under Section 6 of FCRA, it is clearly provided that any organisation having a definite cultural/ social/ educational/ religious/ economic object shall only accept foreign contribution after satisfying two conditions: It must registers itself with the Central Government. It must agrees to receive foreign contribution only through one specific bank account. POINT CONSIDERATION FOR REGISTRATION PROCESS UNDER FCRA Under section 6 of FCRA, organisations having a definite cultural/social/educational religious/economic object shall accept foreign contribution only after registering itself with the Central Government as per the provision of FCRA. It should receive foreign contribution only through one designated Bank account. Although FCRA does not distinguish between registered and unregistered organisations, normally organisations registered under Society Registration Act, 1860, the Companies Act, 1956, the Bombay Public Trust Act, 1950 or as a public trust are only eligible for registration.

8 It is necessary to open and designate one specific bank account for receipt of foreign contribution. This bank account should be only for foreign contribution, and domestic contribution should not be mixed into this account. (v) To apply for registration, Form FC-8 along with enclosures is required to be filed in duplicate to the Secretary, Government of India, Ministry of Home Affairs, Internal Security Wing-FCRA, 4th Floor, Lok Nayak Bhawan, Near Khan Market, New Delhi The time limit for making an application for registration has not been prescribed in the Act. Therefore, an application for registering under FCRA can be made any time after the legal constitution of an organisation. Form FC-8 and Form FC- 1A, requires three years audited statements to be enclosed with the application forms. This is a directory provision and the organisations can submit the audited statements for lesser number of years as are available. It may be difficult for an absolutely new organisation to get FCRA registration because certain past activities and records help the FCRA authorities to determine the genuineness and relevance of the organisation. Form FC- 1A, also requires enclosures of three years audited statements, but, normally even a new organisation having a confirmed commitment from the donor is entitled to apply for prior permission. And the requirement of three years audited statements is waived accordingly. After the application is made, the FCRA department may make field inquiry with the help of Intelligence Bureau. On the basis of the report submitted by the Intelligence Bureau, the application would be processed and accordingly accepted or rejected. There is no time limit provided under FCRA for processing of the application. Normally, six months should be taken to process an application for registration. At times, application are delayed. It is important to ensure that the recommendation certificate of the appropriate authority under clause 10A in Form FC-8 is enclosed. It will help in expediting the application. The Chief functionary is required to give an undertaking regarding the following: (i) Inform within 30days regarding change of name, address, objects, etc., with evidence. (ii) Not to accept any foreign contribution without prior permission, if more than 50% of the office

9 bearers as are mentioned in the application for registration are changed or replaced. (iii) Not to change the bank account or branch of the bank without prior permission. (iv) Not to accept foreign contribution before the registration is granted or with prior permission only. The undertaking given by the Chief functionaries was amended vide notification dt Therefore, it can be argued that all organisation registered prior to are not bound by the undertaking which they have not given. In such circumstances, only those organisations who applied on or after are debarred from accepting foreign contribution, in case of a change of more that 50% of the Office bearers. It is not necessary for an organisation to possess registration under section 12A of the Income Tax Act before applying for registration under FCRA. But, it is desirable that 12A registration is availed before applying for FCRA registration. Under Indian laws, a valid charitable organisation can be registered with a foreigner on its Board. Therefore, application for registration can be made by such society having foreigner as its member. The presence of a foreigner may make the FCRA authorities more vigilant and circumspect while processing the application. FCRA authorities normally do not grant registration in such cases. Charitable organisations engaged in publishing newspaper are not eligible for registration unless the publication falls in category B of publication under Press Registration of Books Act, A certificate of recommendations from the following authorities is required to be enclosed: (a) Collector of District (b) Department of the State Government (c) Ministry or Department of the Government of India If the application is rejected, an appeal within 60 days from the date of the order can be made to the High Court.

10 The reasons for refusal are not explicitly, provided in section 6, but the refusal for registration could be on the basis of any of the reason specified in section 10 : (i) the sovereignty and integrity of India; or (ii) the public interest; or (iii) freedom or fairness of election to any Legislature; or (iv) friendly relations with any foreign State; or (v) harmony between religious, racial, linguistic or regional groups, castes or communities. Form for registration - Organisations desirous of registering themselves with the FCRA department are required to apply in Form FC-8 along with various documents. CHECKLIST OF DOCUMENTS TO BE FILED The following documents must be filed for obtaining registration : i) Form FC-8 duly filled up in triplicate. ii) Audited statement of accounts of past three years. iii) Annual Report specifying activities of past 5 years. iv) Detail of the beneficiaries and detail of the socio-economic factors of the region in which the NGO is working. v) List and geographical detail of the state, and districts proposed for work. vi) Certified copy of the Registration Certificate. vii) Certified copy of the Bye-laws and Memorandum and Article of Association whichever is applicable. viii) Copy of certificates of exemption or registration issued by the Income Tax Department u/s. 80G and 12A. ix) Copy of any prior permission granted to the organisation. x) Copy of resolution of Governing Body of the organisation, authorising the registration under FCRA. xi) Copy of Power of Attorney or the resolution of Governing Body by which the Chief Functionary is authorised to

11 submit FC-8. xii) List of present members of the Governing Body of the organisation and the office bearers. xiii) Copy of any Journal or other publication of the organisation. xiv) If the association is having any parent or sister or subsidiary organisation, which is registered under the FCRA then the registration number along with Ministry of Home Affairs file number should be mentioned. xv) If the association has submitted any application earlier then its reference number should be mentioned. xvi) If the association has received any foreign contribution with or without the prior approval of the Central Government, then the detail should be given. The onus of getting registered under FCRA lies on the association and therefore before accepting foreign contribution, it is the responsibility of association to ensure all the requisite formalities are complied with and registration is granted before accepting any foreign exchange. BENEFITS 12A Registration means Income of the society shall not be taxable. This is one time registration. 80G Registration means Donor can claim exemption. This is periodic registration. Benefits in taking grants from Govt./Abroad/ other Agencies. Benefit in FCRA Registration. The online registration process of FCRA Instructions for FCRA online registration under Sec. 6 of the FC(R) Act, For online filing of application form a user ID is required to be created for online registration.

12 2. After successful registration applicant/user can login to the 'FCRA Online Services' and select the option for the type of application you wish to fill and click 'Login'. For online submission of application for Registration (FC-8 Form), select the option 'FC-8 Registration'.

13 3. After the successful login, FC-8 form will be displayed.

14 4. The FC-8 form has been divided in three parts to facilitate simple online filing of application for grant of Registration under Sec. 6 of the FC(R) Act, Start with Click at 'Registration' of the menu item. Fill in the requisite details in the Form FC-8. Click 'Save details and Next' after filling the details, the details will be saved and next part is displayed to fill the details of Executive Committee/Governing Council, etc.

15 6. Fill in the details of the members of the Executive Committee/Governing Council etc. followed by click at button 'Add '. The details will be shown in the lower part of the screen.

16 Details shown in the lower portion of screen can be updated by clicking the 'Edit' link provided in the requisite row. The details will be shown in the top portion of the screen. Modify the details as needed followed by click on the 'Update' button. For deleting the details 'Delete' link of the requisite row may be clicked. The details of all members of Executive Committee/Governing Council, etc. are necessary for submitting the application. After completing the details 'Save details and Next' may be clicked. 7. On filling the remaining details of the Form FC-8, the button 'Save and Final Submit to the Ministry' may be clicked to submit the application to Ministry of Home Affairs. Please note the file reference number appearing on the screen as acknowledgement and for further correspondence and online status enquiry.

17 8. Click 'Print Application' option of the menu item to print the filled-in Form FC-8. It will show the details filled by you. Printout of the same may be taken which needs to be signed and submitted to Ministry of Home Affairs with relevant enclosures expeditiously. 9. Enclose following documents, wherever applicable, along with the signed copy of application before submitting that to Ministry of Home Affairs. i. Certified copy of Registration Certificate under the relevant statute, Memorandum of Association or Trust deed, as the case may be. ii. Details of activities during the last three years.

18 iii. Copies of audited statement of accounts for the past three years (Assets and Liabilities, Receipts and Payment, Income and Expenditure account). iv. If functioning as editor, owner, printer or publisher of a publication registered under the Press and Registration of Books Act, 1867, a certificate from the Press Registrar that the publication is not a newspaper in terms of section 1(1) of the said act. v. Certificate of the competent authority on official status under signature and seal on prescribed format in original (this is optional). This certificate allows granting of registration and conducting field enquiry. vi. Any additional information which applicant wishes to submit. vii. Please attach all the enclosures and bind them with the application duly numbered starting from covering letter. 10. Furnish information exactly in the manner asked for in the Form FC-8, especially the names and addresses of the members of the Executive Committee/Governing Council etc. 11. Submit the hard copy of the completed application along with relevant documents within 15 days of submission of online application to the Ministry of Home Affairs, Government of India. 12. Click 'Instructions for filing' to get the instructions regarding how to file and submit the FC-8 Form. 13. Click 'Change Password' of the menu to change your password. The new password will be effective from next login.

19 FCRA FUNDING & GRANT - FILING FOR PRIOR PERMISSION ONLINE: Instructions for filing online FC-1A Form for Application for seeking Prior Permission to accept foreign contribution by an Association having a definite cultural, economic, educational, religious or social programme under Sec. 6 of the FC(R) Act, For online filing of application form for seeking Prior Permission a user ID is required to be created.

20 2. After successful registration applicant/user can login to the 'FCRA Online Services' and select the option for the type of application you wish to fill and click 'Login'. For online submission of application for seeking Prior Permission (FC-1A Form), select the option 'FC-1A Prior Permission'. 3. After the successful login, FCRA Prior Permission Menu will be displayed.

21 4. The FC-1A form has been divided in four parts to facilitate simple online filing of application for grant of Prior Permission under Sec. 6 of the FC(R) Act, Start with Click at 'Prior Permission' of the menu item or 'Click here to file Prior Permission'. Fill in the requisite details in the Form FC-1A. Click 'Save and Next' after filling the details, the details will be saved and next part is displayed to fill the details of Executive Committee/Governing Council, etc.

22 6. If you have already filled in the details and application has not been finally submitted the Ministry then click at 'Click here to complete' to continue filing the FC-1A online. The menu will also provide the details of the previous applications filed by the association along with their status. This screen also provides the latest status of the FC-1A submission to the Ministry by the association.

23 7. Fill in the details of the members of the Executive Committee/Governing Council etc. followed by click at button 'Add '. The details will be shown in the lower part of the screen.

24 Details shown in the lower portion of screen can be updated by clicking the 'Edit' link provided in the requisite row. The details will be shown in the top portion of the screen. Modify the details as needed followed by click on the 'Update' button. For deleting the details 'Delete' link of the requisite row may be clicked. The details of all members of Executive Committee/Governing Council, etc. are necessary for submitting the application. After completing the details 'Save details and Next' may be clicked, the details will be saved and third part is displayed

25 8. Fill in the requisite details of the Form FC-1A, the button 'Save and Next' may be clicked. The filled details will be saved and last part of the Form FC-1A will be displayed. 9. Filing the requisite details in the FC-1A pertaining to donors. Fill in the requisite donor details and click at 'Add Donor'. The details of donor will be saved and information displayed at the lower portion of the screen. Fill in the details of additional donors, if any. Details shown in the lower portion of screen can be updated by clicking the 'Edit' link provided in the

26 requisite row. The details will be shown in the top portion of the screen. Modify the details as needed followed by click on the 'Update' button. For deleting the details 'Delete' link of the requisite row may be clicked. Please check thoroughly the filled details in part 1 to 4. If the filled in details are correct then click at 'Final Submit to the Ministry' may be clicked to submit the application to the Ministry of Home Affairs.

27 10. Click 'Print Application' option of the menu item to print the filled-in Form FC-1A. It will show the details filled by you. Printout of the same may be taken which needs to be signed and submitted to Ministry of Home Affairs along with relevant enclosures expeditiously. 11. Enclose following documents, wherever applicable, along with the signed copy of application before submitting that to Ministry of Home Affairs. i. Copy of Registration Certificate under the relevant statute, Memorandum of Association or Trust deed, as the case may be. ii. Commitment letter from the donor(s). iii. Project Report along with budget break-up as per Column 8(ii).. iv. If functioning as editor, owner, printer or publisher of a publication registered under the Press and Registration of Books Act, 1867, a certificate from the Press Registrar that the publication is not a newspaper in terms of section 1(1) of the said act. v. Certificate of the competent recommending authority on official stationery under signature and seal on prescribed format in original (this is optional). This certificate facilitates early disposal of the case. vi. Any additional information which applicant wishes to submit. vii. A copy of FC-3 Returns in respect of all the foreign contribution received earlier with the prior permission of MHA. viii. Please attach all the enclosures and bind them with the application duly numbered starting from covering letter.

28 12. Furnish information exactly in the manner asked for in the Form FC-1A, especially the names and addresses of the members of the Executive Committee/Governing Council etc. 13. Submit the hard copy of the completed application along with relevant documents within 7 days of submission of online application to the Ministry of Home Affairs, Government of India. 14. Click 'How to apply' to get the instructions regarding how to file and submit the FC-1A Form. 15. Click 'Change Password' of the menu to change your password. The new password will be effective from next login. 16. Click 'Logout' to stop using FCRA Online Services.