Home ministry amends FCRA rules; gives more time to declare funds

Source: The post is based on the article “Home ministry amends FCRA rules; gives more time to declare funds” published in Hindustan Times on 3rd July 2022.

What is the News?

The Ministry of Home Affairs has amended certain provisions in the Foreign Contribution (Regulation) Act (FCRA) and its rules.

What are the key amendments made?

Firstly, it allowed Indians to receive up to Rs 10 lakh annually from their relatives abroad under FCRA. The limit earlier was Rs 1 lakh.

If the amount exceeds, the individuals will now have 90 days to inform the government instead of 30 days earlier.

Secondly, it has given individuals and organizations or NGOs 45 days to inform the ministry about bank account(s) that are to be used for the utilization of such funds. This time limit was 30 days earlier.

Thirdly, organizations receiving foreign funds will not be able to use more than 20% of such funds for administrative purposes. This limit was 50% before 2020.

Fourthly, the rules have done away with the provision where an organization/individual receiving foreign funds had to declare such contributions every quarter on its official website.

Now, anyone receiving foreign funds under the FCRA will have to follow the existing provision of placing the audited statement of accounts for every financial year beginning on the first day of April.

Fifthly, it has made five more offences under the FCRA “compoundable”, making 12 such offences compoundable instead of directly prosecuting the organizations or individuals.

Note: Compoundable offences are those offences where, the complainant (one who has filed the case, i.e. the victim), enters into a compromise and agrees to have the charges dropped against the accused. However, such a compromise should be a “Bonafide,” and not for any consideration to which the complainant is not entitled.

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