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Drumbeat: Ad Buzzaar
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Monday, August 24, 1998
Get registered before accepting foreign contribution
BS Jindal & Akhil Jindal
Any society trust or charitable company carrying on educational, charitable, religious, cultural or social activities and want or in the process of receiving the foreign contribution from a foreign source are required to obtain registration under the Foreign Contribution Regulation Act (FCRA) 1976. In case they do not follow, they may may be liable for penalty and punishment which may be up to imprisonment for a term of five years or with fine or both.The act applies to: Any association whether registered as a legal entity that is society trust or charitable or charitable company or not having an office in India with the charitable object Any foreign branch subsidiary or associate of any Indian organisation Any citizen of India whether residing in India or outside India.For this purpose, foreign contribution has been defined as to mean receipt of donation, delivery or transfer from any foreign source of any Indian or foreign currency and article excluding personal gift of value up to Rs 1,000 and any foreign security. Foreign hospitality has been defined as any offer made by a foreign source for providing a person with the cost of travel to any foreign country or with free board, lodging transport or medical treatment. The act prohibits a number of legislature office-bearer of a political party judge government servant or an employee of government company corporation from accepting any foreign hospitality without obtaining prior permission of the central government. The central government has exempted the member of government-sponsored delegations and employees of corporation under an agreement with the foreign country from asking a permission. The organisation to register under the FCRA, should be a legal entity and existing for a period of at least three years. The application of registration is to be made in form FC-8 with the following information: The memorandum of Association or trust deed Certified copy of registration certificate Report of the charitable activities of the trust Audited accounts for the last three years Name and address of the organisation along with the name and addresses of the important office bearers and chief functionary Name and address of the bank account number designated by the applicant organisation for receiving foreign contributions Detail of movable property and immovable property Detail of employees Detail of activities Detail of proposed use of funds.The application has to filed with the Ministry of Home Affairs, Government of India, New Delhi. The FCRA department checks the information and then grants the registration under the FCRA. The organisation registered under the FCRA has to file returns in duplicate within four months from the close of the financial year. The organisation has to furnish the certified accounts by a chartered accountant along with the receipts and payments account. Any person who accepts or assists any person or association in accepting any foreign contribution contravening any provision of the act or rules shall be punishable with imprisonments for a term of up to five years or with penalty or both as may be ordered. The Jindals are Delhi-based chartered accountants Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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