FCRA

Question 1

Provisions for emergent medical aid recd. by restricted persons

Answer 1

1. Prior approval not needed
2. CG should be intimated within a month only if value of aid received exceeds 1 lakh
3. Otherwise no intimation needed
4. Details - Source, purpose, manner utilised, approximate value in rupees

Question 2

What is foreign contribution

Answer 2

D- Donation
D- Delivery
T-Transfer
-made by a foreign source directly / indirectly of
- any article (exception - gift- personal use- mkt value in india on dt of gift not more than 1 lakh)
- indian/ foreign currency
- security defined under fema & scra

Question 3

Deemed foreign contribution (2)

Answer 3

1. any other income derived from the foreign contribution or interest thereon
2. DDT of any article, currency , foreign security by any person who has received it from a foreign source either directly or through one or more persons

Question 4

exclusion from foreign contribution (3)

Answer 4

1. any fee received
2. any consideration in lieu of goods or service in ordinary course of biz.
3. any contribution received from agent of such foreign source towards such fee or cost

Question 5

What foreign contribution is allowed to be received even by a person who is prohibited under section 3

Answer 5

1. ordinary course of biz
2. SALARY, wages or other remuneration
3. remittance in ordinary course of business through official channel , post office or any authorised person in forex under FEMA
4. scholarship, stipend or payment
5. gift as an indian delegate accepted and retained as per CG rules
6. gift from a relative more than 1 lakh
7. as an agent of a foreign source in relation to any transaction made by the foreign source with the CG or SG

Question 6

Define foreign hospitality

Answer 6

Any offer

• NOT BEING A PURELY CASUAL ONE
• made in cash or kind by a foreign source
• to provide cost of travel
• to any foreign country/ territory
• or free :
• boarding
• lodging
• transport
• medical treatment

Question 7

Persons who have restrictions in taking foreign hospitality

Answer 7

ME JOG
M - Members of legislature
E- Employees for any corporation/any other body owned or controlled by the govt
J - Judges
O - Office Bearers of political parties
G - Government servants

Question 8

What is the restriction on accepting foreign hospitality for restricted persons

Answer 8

• CG approval 2 weeks before proposed date of travel
• Application along with copy of invitation by host country
  + administrative clearance from the department of govt. or ministry if the trip is sponsored by them

Question 9

Exception under which provisions of PMLA can be relaxed

Answer 9

The CG can relax all or any provisions of FCRA or modify or revoke such order

• if it finds necessary or expedient in interest of general public
• for an individual (except - candidate for election)
• organisation ( except - political party)
• association
• person

Question 10

Restrictions on transfer of foreign contribution from a person who is registered or has prior CG permission to a person who doesnt

Answer 10

Can’t transfer more than 10 % of total value
- Make application to CG
- Declaration annexed:
- amt proposed to be transferred during the FY is less than 10% of tot value of fc received by him during the year
-the tranferor shall not transfer any amount of FC until the CG approves the transfer
-

Question 11

Restrictions on transfer of foreign contribution from a person who is registered or has prior CG permission to a person who also does

Answer 11

-not required to seek the prior approval of the Central Government for transferring the foreign contribution —-provided that the recipient has not been proceeded against under any of the provisions of the Act.

Question 12

Responsibility for proper utilisation of the foreign contribution in case of transfer

Answer 12

• Both transferor and transferee

- Transfer shall be reflected in FC-6 submitted by both

Question 13

Person registered/certificate/permission - restriction on utilisation

Answer 13

• Any foreign contribution OR ANY INCOME ARISING OUT OF IT shall not be used for speculative business
• Can’t use more than 20% of FC recd in a FY for admin without prior approval of CG
• shall be used for the purpose obtained

Question 14

Amounts not to be counted as administrative expenses:

Answer 14

1. Expenditure incurred on salaries or remuneration of personnel engaged in training or for collection or analysis of field data of an association primarily engaged in research or training ;
2. Expenses incurred directly in furtherance of the stated objectives of the welfare oriented organisation such as salaries to doctors of hospital, salaries to teachers of school etc

Question 15

Speculative activities meaning

Answer 15

(i) any activity or investment that has an element of risk of appreciation or depreciation of the original investment, linked to market forces, including investment in mutual funds or in shares;
(ii) participation in any scheme that promises high returns like investment in chits or land or similar assets not directly linked to the declared aims and objectives of the organization or association.
Note: A debt-based secure investment shall not be treated as speculative investment.

Question 16

Mandatory certificate of registration / prior permission of CG needed for accepting FC for

Answer 16

A person having definite economic, cultural,religious or social programme

Question 17

Cooling period after cancellation of certificate

Answer 17

3 years

Question 18

Grounds for cancellation of certificate after inquiry

Answer 18

• incorrect/false statement in the application
• violated T&C of certificate or renewal
• violated provisions of the act
• CG opinion , to cancel in public interest
• not engaged in reasonable activity in its chosen field for two consecutive years
• has become defunct