FCRA Registration is an essential compliance requirement for enterprises involved in social upliftment and is required of groups seeking foreign donations. The government authority issues the registration certificate, which must be obtained to apply for or accept funds from overseas charitable organizations, social institutions, and registered trusts.Charitable Trusts, Societies, Section 8 Company that receive foreign contribution or donation from foreign sources are required to obtain registration under Section 6(1) of Foreign Contribution Regulation Act, 2010. Such a registration under the Foreign Contribution Regulation Act, 2010 is called a FCRA registration. In this article, we look at the procedure for obtaining FCRA registration in India.
Significance of the Fair Credit Reporting Act of 2010
The 2010 Foreign Contribution Regulation Act was created to achieve the following objectives
- Organisations can no longer receive unrestricted foreign funding or accept hospitality from foreign governments.
- No foreign hospitality or gift may be accepted or used for actions harmful to the national interest, related to, or ancillary activities damaging the national interest.
Eligibility for obtaining FCRA Registration
Organizations seeking foreign contributions for definite cultural, social, economic, educational or religious programmes may obtain FCRA registration or receive foreign contribution through “prior permission” route. It is preferable for an FCRA applicant to be a Trust or Society or a Section 8 Company. The not-for-profit entity must have also been in existence for a minimum of three years while making the FCRA application and should not have received any foreign contribution prior to that without the Government’s approval. Additionally, the entity seeking registration should have spent at least Rs.10,00,000/- over the last three years on its aims and objects, excluding administrative expenditure. Statements of Income & Expenditure, duly audited by Chartered Accountant, for last three years are to be submitted to substantiate that it meets the financial parameter.
In case a newly registered entity would like to receive foreign contributions, then approval for a specific activity, specific purpose and from a specific source can be made to the Ministry of Home Affairs through the Prior Permission (PP) method.
Criteria for grant of FCRA Registration
The ‘person’ or ‘entity’ making an application for registration or grant of prior permission-
- Is not fictitious or benami;
- Has not been prosecuted or convicted for indulging in activities aimed at conversion through inducement or force, either directly or indirectly, from one religious faith to another;
- Has not been prosecuted or convicted for creating communal tension or disharmony in any specified district or any other part of the country;
- Has not been found guilty of diversion or mis-utilisation of its funds;
- Is not engaged or likely to engage in propagation of sedition or advocate violent methods to achieve its ends;
- Is not likely to use the foreign contribution for personal gains or divert it for undesirable purposes;
- Has not contravened any of the provisions of this Act;
- Has not been prohibited from accepting foreign contribution;
- The person being an individual, such individual has neither been convicted under any law for the time being in force nor any prosecution for any offence is pending against him.
- The person being other than an individual, any of its directors or office bearers has neither been convicted under any law for the time being in force nor any prosecution for any offence is pending against him.
The acceptance of foreign contribution by the entity / person is not likely to affect prejudicially –
- The sovereignty and integrity of India;
- The security, strategic, scientific or economic interest of the State;
- The public interest;
- Freedom or fairness of election to any Legislature;
- Friendly relation with any foreign State;
- Harmony between religious, racial, social, linguistic, regional groups, castes or communities.
The acceptance of foreign contribution-
- Shall not lead to incitement of an offence;
- Shall not endanger the life or physical safety of any person.
What Are the Benefits of FCRA Registration?
FCRA (Foreign Contribution Regulation Act) registration offers several benefits to eligible entities in India:
Legal Compliance: FCRA registration allows organizations to legally receive foreign contributions and donations, ensuring compliance with Indian laws.
Global Outreach: Registered entities can access international funding sources, fostering global partnerships and collaborations.
Trustworthiness: FCRA registration enhances an organization’s credibility and trustworthiness among donors, both foreign and domestic.
Transparency: Registered entities are required to maintain transparency in financial transactions, promoting accountability.
Ease of Fund Management: FCRA-registered organizations can efficiently manage and utilize foreign contributions for their charitable activities.
Applying for FCRA Registration
pplication for FCRA registration can be made using Form FC-3. Along with the application, the following documents must be submitted:
- Self-certified copy of registration certificate/Trust deed etc., of the association
- Self-certified copy of relevant pages of Memorandum of Association/ Article of Association showing aim and objects of the association.
- Activity Report indicating details of activities during the last three years;
- Copies of relevant audited statement of accounts for the past three years (Assets and Liabilities, Receipt and Payment, Income and Expenditure) clearly reflecting expenditure incurred on aims and objects of the association and on administrative expenditure;
Once FCRA registration is granted, it is valid for a period of five years. An application for renewal of FCRA registration can be made 6 months prior to the date of expiry, to keep the registration valid.
Online FCRA Registration process
1. Visit the FCRA website as the first step.
2. Select the “FCRA Online Forms” option to complete your FCRA registration.
3. Finish up your FCRA registration application by clicking the link on the next screen. Follow the link to go on to the next page.
4. To submit your application for FC3, select the “Click to Apply Online” link
5. You need to sign up into FCRA, select sign-up option. The link will move to next page.
6. Enter all mandatory details and click on save.
7. On clicking on save a message will be shown in the screen ‘User ID successfully created and Your user ID is:’
Login to FCRA
8. Login into the portal using this User ID and password.
9. You can see an option ‘I am applying for’ select FCRA registration from drop-down menu. Click on Apply online.
10. To proceed registration ‘click here to Proceed New Registration’
11. Click on FC3 Menu in title bar for proceedings step by step registration.
Association Details
12. Select Association Details from the menu. The association detail form will be displayed. Enter all below mentioned mandatory details.
- Darpan ID
- Address of Association
- Registration number
- Place of registration
- Date of registration
- Nature of association
- Main aim of the association
13. Click on submit button to save data.
Executive Committee Form
14. Now go to Executive Committee Form by clicking on Executive Committee option from menu bar.
15. Enter all details about Executive Committee.
16. Select ‘Add details of Key Functionary’, you can now edit/delete/add Details of Information of Executive Committee.
17. To add further foreigner details, select checkbox of the record which one you want and click on Add/View button.
18. New screen will be displayed, add related foreigner details. You can able to Edit/Delete Record by clicking on the appropriate option.
EC detail and others
19. You need to fill EC details and others. Select this option from the menu list.
20. Click on save after entering all mandatory details of EC.
Bank Details
21. In this section provide your bank details such as Bank Name, IFSC code, Account Number, Address of the bank.
Other details Section
22. Click on Other Details option from the menu to provide all other information.
Upload documents
23. You need to upload all relevant documents in PDF format.
Final Submission
24. Click on final submission from the menu bar. You have to declare the application form, enter place and date and click on final submit.
25. Once you submitted finally, a pop-up window will appear, click on OK.
Note: After final submission, you can’t modify application details.
Online payment
26. After clicking on Make Online Payment button from menu bar, the payment screen will be displayed.
27. Click on Continue for Payment button in this screen, a screen will be pop up on the screen. Select the payment gateway and click on payment.
Renewal of FCRA Registration
Once FCRA registration is granted, it is valid for a period of five years. An application for renewal of FCRA registration can be made 6 months prior to the date of expiry, to keep the registration valid.
Step 1: Select Application for Renewal of FCRA Registration from FCRA Online Forms.
Step 2: On clicking on this, the page will be redirected to next page. Select Click to apply online.
Step 3: Enter your user ID & password and login to the FCRA portal.
Step 4: You can see an option ‘I am applying for’ select FCRA renewal from drop-down menu. For renewing FCRA registration follow above given steps 10 to 28.
What Are the Penalties for Violation of FCRA?
The penalties for violating the FCRA depend on the nature of the offence committed, and the damages suffered by the victim. Here are some of the penalties for FCRA violations in India:
Compounding of offences: The FCRA Department has specified the list of offences that are compoundable in nature. Such compounding can be proceeded by the respective authorities mentioned in the Gazette.
Actual damages: This refers to the amount of money that the victim lost as a result of the FCRA violation. There is no set limit or minimum for actual damages.
Statutory damages: These are damages that don’t require proof of actual damages, but the compensation is limited to Rs. 1,00,000/- or 5% of the foreign contribution received during the period of non-submission, whichever is higher.
Punitive damages: These are awarded to punish an agency, business, or individual and deter them from violating the FCRA again. There is no limit on how much can be awarded.
Fines: NGOs that do not comply with or violate the act can be fined by the Ministry of Home Affairs.
Prohibition on accepting foreign contributions: NGOs convicted twice can be prohibited from accepting foreign contributions for three years.
Seizure and confiscation: In case of contravention, the Central Government has the power to seize and confiscate currency and articles under FCRA.
Compulsory prior permission requirement: NGOs can be required to obtain prior permission even if they are registered under FCRA.
Inspection and seizure of accounts and records: The authorities can inspect and seize accounts and records of NGOs that violate the FCRA.
FAQs
Q: Are there penalties for violations of the FCRA?
Yes, there are penalties for willful noncompliance with the FCRA. Violators may be subject to fines, damages, and, in some cases, criminal penalties.
Q: What is a consumer report under the FCRA?
A consumer report is any communication of information by a consumer reporting agency that relates to a person’s creditworthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living.
Q: What information is included in a credit report?
A credit report typically includes personal information, credit accounts, payment history, public records (such as bankruptcies or tax liens), and inquiries made on the consumer’s credit history.
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