Rules amended, NGOs under FCRA will have to declare movable, immovable

Source: The post is based on the article “Rules amended, NGOs under FCRA will have to declare movable, immovable”  published in TOI on 26th September 2023

What is the News?

The Union Ministry of Home Affairs (MHA) has modified rules pertaining to filing of annual returns by non-government organizations(NGOS) registered under the Foreign Contribution Regulation Act (FCRA).

What is the FCRA?

The FCRA regulates foreign donations and ensures that such contributions do not adversely affect internal security. 

It was enacted during the Emergency in 1976 amid apprehensions that foreign powers were interfering in India’s affairs by pumping money into the country through independent organizations.

The law mandates that all NGOs register themselves under the FCRA and its registration is initially valid for five years and it can be renewed subsequently if they comply with all norms.

As per the FCRA, every person or NGO seeking foreign donations has to be registered under the Act and has to open a bank account in State Bank of India, Delhi. 

Moreover, they can utilize the funds received from abroad only for the purpose they stated during registration.

What are the new rules introduced now?

NGOs and associations registered under the Foreign Contribution Regulation Act (FCRA) will now be required to annually declare details of movable and immovable assets created by them out of the foreign contributions received.

What were the changes made to the FCRA in the past?

In 2020, the Centre had amended the FCRA.It had stated that foreign contributions received by an organization cannot be transferred to any other person or organization unless that person or organization is also registered to accept foreign contributions.

The new rules had also reduced the use of foreign funds to meet administrative costs by NGOs to 20 percent from the existing 50 per cent.

In 2022, the Centre made more amendments, allowing Indians to receive up to Rs 10 lakh in a year from relatives staying abroad without informing the authorities.The earlier limit was Rs 1 lakh.If the amount exceeds, the individuals will now have 90 days to inform the government instead of 30 days earlier.