FCRA Registration – Eligibility and Application Procedure

What is FCRA Registration?

FCRA stands for Foreign Contribution Regulation Act that governs and regulated foreign contributions occurring within India. FCRA Registration Certificate issued by the government authority is a mandatory obligation to acquire or receive any foreign contribution or foreign grants by any registered trust, society, institution, association, and NGOs.

The primary objective of FCRA registration is to legalize the receipt of any foreign contribution by domestic entities and for ensuring the proper utilization of such funds for the specified objective.

The minimum requirement for FCRA Registration

Following is the key requirement for applying FCRA Registration depending upon the type of registration such as:

A) Obligations for Proper FCRA Registration:

• The applicant shall be a registered entity and must be operating for a minimum of 5 years.
  
• Applicant entity must have spent at least INR 10 Lakhs in the previous three years for the attainment of its main objects for which the entity was registered excluding administrative expenses made.
  
• The last three years financial statement audited by a qualified chartered accountant shall be submitted by an applicant.
  

B) The Obligation for Prior Permission FCRA Registration:

• If the newly registered entity is willing to receive a foreign contribution or foreign grants shall apply for prior permission
  
• During applying for the same, it shall give the details relating to a foreign owner who is contributing the fund
  
• The fund received shall be utilized only for the specified purpose
  

Eligibility for applying for FCRA Registration

Following are the eligible entities for applying for FCRA registration:

• Trust registered under the Indian Trust Act
  
• Societies registered under Indian Society Registration Act
  
• Section-8 companies incorporated under the Companies Act
  
• The applicant must be registered as NPO set up with charitable objectives for serving the society by promoting health, education, economic development, promotion of art, culture, religion, sports, etc
  
• The entity must not be prohibited in any form by the provision of the Foreign Contribution (Regulation) Act.
  
• Foreign contribution accepted shall not endanger the life or safety of any individual or shall not lead to any offence.
  

Non-Eligible entities for applying for FCRA Registration

Following entities are not allowed to be granted FCRA registration:

• The applicant is fictitious or Benami.
  
• Applicant against whom prosecution is conducted for indulging in any unfair activity
  
• An applicant who has been convicted or prosecuted for any communal tension made in any area of specified district or any part of the country
  
• Is engaged in any violent activities
  
• Has utilized foreign contribution for its personal use
  
• Any entity de-bared for accepting any foreign receipt or foreign grant under any provision of law.
  
• Any such acceptance of foreign grant that affects prejudicially:
  

• The sovereignty of India

• Public Interest

• Relationship with any state.

Documents Required

Following documents shall be annexed with the online application:

• Self-certified copy of incorporation certificate, trust deed, or any other certificate hold by such entity.
  
• PAN of NGO
  
• Copy of MOA & AOA of associations and institutions
  
• Signature of the chief judiciary in JPG format
  
• A detailed report on activities of the preceding three years.
  
• Audited copy of financial statement, P&L account, Income-Expenditure details, and cash flow statement of the preceding three years.
  
• CTC of the resolution passed by a governing body authorized by NGO
  
• Certificate obtained under section 80G and 12A of Income Tax. Section 80G and 12A provide tax exemption to NGOs under the Income-tax Act.
  

FCRA Registration Process

Following is the step by step online process of applying for FCRA license:

• Apply online through filling online form FC-3 available on the official website of FCRA https://fcraonline.nic.in
  
• Click option “FCRA Online Forms” for registration under FCRA.
  

• The applicant will be redirected to the next page for several options such as application for seeking the permission of the central government, foreign receipt intimation, application for FCRA registration, etc. Select application for FCRA registration link. 
  

• Select “Apply Online” option under Application for FCRA Registration (FC-3)
  

• New user needs to sign up for completing the application form
  
• Fill the form and complete all the mandatory details
  
• Once the form is completed, click the save button after which “User id” will be generated automatically.
  
• Then applicant needs to sign up using the login credential generated automatically on the above procedure.
  
• Continue to start step by step registration.
  
• Once the entire form is completed, the applicant needs to scan and attach the documents in PDF Format.
  
• Complete the online registration by making online payment through online payment gateways.
  

Renewal of FCRA License

FCRA registration remains valid for five years, which can be renewed by applying for the renewal. An entity shall apply for renewal within the following timelines:

• At least six months before the date when the license is getting lapsed.
  
• At least 12 months before the date when registration lapses, in cases the entity is operating on a multi-year project.
  

Cancellation/Suspension of FCRA Registration

In case authorities are of the view that registered entity is not operating as per the provisions of law and its license needs to be cancelled, such authority can do so by giving the notice to the concerned entity. Following are the few reasons that can be considered while cancelling the license:

• NGO fails to comply with the provisions of the Foreign Contribution (Regulation) Act.
  
• If the entity fails to submit an annual return within the due date
  
• In case any inquiry is made for any allegation imposed against such organization for any wrongdoing in operations, and such allegation proved to be true
  
• Contribution received is not utilized for the attainment of the main object of entity neither for achieving the purpose stated during FCRA registration application
  

FAQs

Q. Whether any donation by an individual of Indian origin and having foreign nationality be counted as ‘Foreign contribution’?

Yes. Such donation will be treated as foreign contribution. However, 'Non-resident Indians', who still have Indian citizenship will not be counted in this category.

Q. Who can be a foreign contributor?

Section 2(1) (j) of FCRA, 2010 has provided clear definition of Foreign source who can provide foreign contribution. This list includes the following:-

 1. Any foreign Government including any agency of such Government.

2. Any international agency, this will not include any agency specifically excluded by the Central Government by notification ( like United Nations or any of its specialized agencies, the World Bank, International Monetary Fund etc.).

3. Foreign company incorporated outside India.

4. Any foreign corporation.

5. Any multi-national corporation referred to in Section 2(g) sub-clause (iv) of FCRA, 2010.

6. Company registered under Companies Act, 1956, whose minimum 51% of share capital is held, either singly or in the aggregate, by:

o   Foreign Government.

o   Foreign citizens.

o   corporations incorporated in a foreign country or territory

o   trusts, societies or other associations of individuals (whether incorporated or not), formed or registered in a foreign country or territory

o   Foreign company.

7. Foreign trade union either registered or not.

8. Foreign trust or a foreign foundation financed majorly by a foreign country or territory.

9. Any society, club or other association or individuals formed or registered outside India.

Q. What are the different types of FCRA registration?

FCRA registration is categorized into the following two types:

• Proper FCRA registration
• Proper Permission for FCRA registration

Eligibility criteria, along with the existence period, are different depending upon the category of FCRA registration.

Q. For how long does the FCRA registration remain valid?

FCRA Registration once granted is valid for five years, which can be renewed by applying for the same within six months before the date of expiry.

Q. What is the compliance required after FCRA registration?

After the receipt of FCRA License, the entity must file an annual return in prescribed form FC-4 online through the official website of https://fcraonline.nic.in along with following documents certified by chartered Accountant shall be annexed with FC-4:

• Scanned copy Income Statement
• Scanned copy of Balance Sheet
• Statement of the foreign receipt
• Payments and expenditure incurred by an entity

 Q. What is the due date of filing an annual return by the FCRA registered entity?

FC-4 is the annual compliance filed within the end of 9 months from the end of the financial year, i.e., this shall be filed on or before the 31st day of December every year.