The Government of India has changed foreign contribution rules for individuals and non-government organisations by increasing the limits and time provided to file disclosures.
Here's how the changed rules work:
For Individuals
Indians can now receive up to Rs 10 lakh in a year from relatives staying abroad without informing the authorities, according to the Foreign Contribution (Regulation) Amendment Rules, 2022, notified by the Home Ministry. The earlier limit was Rs 1 lakh.
If the amount exceeds this limit, an individual will now have 90 days to inform the government instead of 30 days earlier.
The changes were made by amending rule 6 of the Foreign Contribution (Regulation) Rules, 2011. Earlier, the rule required individuals to inform the government within 30 days if they received more than Rs 1 lakh from relatives living abroad.
For NGOs
The Home Ministry made changes to rule 9, which deals with an application for 'registration' or 'prior permission' under the FCRA to receive funds.
The amended rules have given individuals and non-government organisation 45 days to inform the ministry about bank accounts that are to be used for the utilisation of such funds. The earlier time limit was 30 days.
The central government also “omitted” provision 'b' in rule 13 that required an NGO or an individual receiving foreign funds to declare such contributions every quarter on its official website.
Now, they will have to follow the existing provision of publishing the audited statement of accounts on their website, or any other website specified by the government, within nine months of the closure of a financial year starting April, according to the notification. The audited statement of accounts should include an income and expenditure statement, receipt and payment account and balance sheet.
In case of a change of bank account, name, address, aims or key members of the organisation receiving foreign funds, the Home Ministry has now allowed 45 days to inform it, instead of 15 days earlier.
The Home Ministry had made the FCRA rules tougher in November 2020, making it clear that NGOs which may not be directly linked to a political party but engage in political action like bandhs, strikes or road blockades will be considered of political nature if they participate in active politics or party politics.
According to the law, all NGOs receiving funds have to registered under the FCRA.
More Offences Compoundable
In a separate notification, the Home Ministry made five more offences under FCRA “compoundable”, making 12 such offences compoundable instead of directly prosecuting the organisations or individuals.
Compoundable offences allow settlement by paying a penalty.
The FCRA violations which have become compoundable now include failure to intimate about the receipt of foreign funds, opening of bank accounts, failure to place information on a website, etc.
Earlier, offences related to accepting hospitality from a foreign entity without informing, defraying of foreign funds for administrative use beyond permissible limit, receiving money in an account other than specified for foreign funds and four others were compoundable.
The amount of penalty ranges from Rs 10,000 to Rs 1 lakh or 5% of foreign funds, whichever is higher.
- With PTI inputs
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