Non-Governmental Organizations (NGOs), Section 8 non-profit companies, and charitable trusts in India receiving foreign grants or overseas donations operate under the strict oversight of the Ministry of Home Affairs (MHA) via the Foreign Contribution (Regulation) Act, 2010 (FCRA). Following comprehensive statutory amendments in recent years, FCRA governance has tightened drastically. Non-compliance, procedural oversights, or reporting lapses can lead to hefty penalties, suspension of bank accounts, and statutory cancellation of FCRA licenses.
Eligibility Criteria: Normal Registration vs. Prior Permission
Entities seeking foreign funding have two primary gateways: (1) Normal FCRA Registration (Form FC-3A), which requires the trust or society to have been actively operational for at least three years with minimum spent funds of ₹15 Lakhs on its core charitable objectives, and (2) Prior Permission (Form FC-3B), designed for newer organizations seeking clearance for a specific foreign donor and defined project.
Non-Negotiable Operational Mandates Under Current Law
✓Designated FCRA Account at SBI New Delhi Main Branch: All primary inward foreign contributions MUST be received exclusively in the designated account at State Bank of India, NDMB (11 Sansad Marg, New Delhi).
✓Sub-Accounts for Utilization: Funds may be transferred to secondary bank accounts in any scheduled commercial bank for administrative and operational expenditure.
✓Cap on Administrative Expenses: Under the amended Section 8, administrative expenses cannot exceed 20% of the total foreign contribution received in a financial year (reduced from the previous 50% threshold).
✓Prohibition on Sub-Granting: Section 7 strictly prohibits transferring or sub-granting foreign contributions to any other domestic entity or NGO, even if that entity also holds a valid FCRA license.
✓Mandatory Form FC-4 Annual Filing: Annual returns accompanied by audited balance sheets, income & expenditure statements, and CA certificates must be submitted electronically within 9 months of financial year closure (by December 31st).
Frequently Asked Questions
What is the validity period of an FCRA registration certificate?
An FCRA registration is valid for 5 years from the date of grant. The organization must apply for renewal in Form FC-3C at least six months prior to the expiry date to prevent lapse of its certification.
Can an individual or trustee receive personal consulting fees into an FCRA account?
No. FCRA bank accounts are strictly reserved for institutional charitable funds. Mixing personal remittances, business revenue, or domestic grants in the designated FCRA account is a severe statutory violation.
This overview is prepared for educational purposes in accordance with MHA statutory notifications under FCRA, 2010.
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