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The message below on 'Do comment on the Draft FCRA Rules 2011' has been posted by Karmayog on Mar 14, 2011.

If you would like to contribute to the discussion, please leave your comment below.

 Discussions and dialogue on issues leads to finding solutions and solving problems. Hence, we would encourage you to participate in this discussion and help take this issue ahead. Please do not write "yes", "no" type of frivolous comments as these will not be posted. Where the author of the message is seeking support (in the form of an online petition or signature campaign), we urge you to sign up and show your support in large numbers.
Do comment on the Draft FCRA Rules 2011  (20 Responses)
 Subject Do comment on the Draft FCRA Rules 2011
 Main Point Your comments and sugestions on the draft Foreign Contribution (Regulation) Rules 2011
 Category How to Start / Run an NGO
 Message


Contributed by AccountAid

The Ministry of Home Affairs would like to get your comments and sugestions
on the draft Foreign Contribution (Regulation) Rules 2011. Copy of rules are
at www.mha.nic.in/pdfs/Draft-FC-rules-2011.pdf and also
www.karmayog.org/redirect/strred.asp?docId=32451

Email your comments to ds-fcra@nic.in . Do send us a copy for follow-up.

Do also send your comments by post to:
Deputy Secretary (FC)
Ministry of Home Affairs
FCRA Wing
Jaisalmer House
26, Mansingh Road
New Delhi

Last date for sending in your comments is 31-Mar-2011.

Thanks
www.karmayog.org -- Directory of 19000 NGOs

 

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 Posted Date Mar 14, 2011
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20  Comments
 
   20    damu archer,     Aug 05, 2011
 
          Which  format /  Form need to be used for filing FCRA return  for last fin  year i.e. for  FY 2010-11. FC#/ FC6 or  as per new form FC6  mentioned in new rule s


          
          
        M.S. Raju,   Aug 05, 2011
       
               Go on website and download form. At this time and in fact the procedure in operation for some time since early 2011 is that only on- line returns and applications will be accepted =MSRaju, Viison Aid ,Visakhapatnam =
                Reply
       
          damu archer,   Aug 06, 2011
         
                 Thanks Mr Raju.  i  appreciate  your   response.
        D.A.
                  Reply
         
            Ajoy Kumar Basu,   Aug 09, 2011
           
                   

          Present Neo-colonialism in the garb of Democracy is leading our advocacy for a just FCRA nowhere. The size of black money with clear protection by the Government , the lukewarm approach by all political parties and the level & size of corruption are clear indication that FCRA is a mere divertionary strategy. Within law one can take advantage with impunity and thrive.Corrupts are bringing in the new FCRA and CSOs are expecting laws for corruption elimination from them.Something is fundamentally wrong or mismatch in our approach. Corruption with Power will convert everything into corruption, Midas touch is valid forever for good or bad.

          A.K.Basu

                    Reply
           
              Durgashanker Nagda,   Aug 09, 2011
             
                     This is true. Something is basically wrong. We have applied for a merely FC-1A Prior Permission from FCRA in Feb 2010 but as of todate it has not been granted. They said verbally that they have revised the FCRA Rules and Act and we have to deposit Rs.1000 as fee. We did deposit thefee but so far we have not even recieved a receipt of the fee let alone the approval of FC-1A inspite of the FCRA Rules and acts saying that within 90 days the application shall be disposed. Does this not indicate the height of the bureaucracy and non-functioning of the government. One of the CA of Delhi asked me Rs.1.5 lak to get this done and I said when there is no fee for the FC-1A why is this hihg amount needed to get it approved? He merely said this is his fee. So you can understand the situation in India.
                      Reply
             
                MSRaju,   Aug 10, 2011
               
                       FCRA is notorious in creating delays to encourage middlemen .They make noting on applications that some documents are missing and but not inform the party in time Go to Delhi, meet DS( the official interviewing officer) who will direct you to US concerned. Give clear signal to US or SO that middlemen are approaching you but you wont pay them . The officers will understand and will put you in the normal queue and tell you what documents are needed . It will take 3 months but in any case middlemen also cant do better For all our cases we never paid bribe or middlemen Call me on 0 9849493344 if you wish Prof. MSRaju President Vision Aid
                        Reply
               
                  S P Loonker,   Aug 10, 2011
                 
                         Write e-mail to them demanding why they have not issued you PP. Send same by courier, registered a/d and if possible also submit in person. File RTI. It should get done.
                          Reply
                 
     
       19    Kumar Ratan,     Apr 13, 2011
     
              no need to change the FCRA rules. only one thing required is that NGOs should also be covered by RTI Act 2005. thats all.
              
              
          Ajoy Kumar Basu,   Apr 14, 2011
         
                 FCRA is an indignity to the spirit of Voluntarism, the third pillar of democracy.Of course, RTI must be of universal application. We do not want FCRA to be applied to Industry and Government. We want it to be scrapped. FCRA does not match OUR FREE NATION
        or am I wrong? Is ours a regime of RULERS AND SUBJECTS MIND-SET ?

        Ajoy Kumar Basu
                  Reply
         
       
         18    Siddhartha Vatsyayan,     Apr 05, 2011
       
               

      Dear Arun,
      In the mails forwarded to you there are one or two important points for comment or challenging the rules: -

      Why re- Registration if all your reports are in time and no discrepancy is observed in accounts, Why re-registration if the NGO is not indulging in Political activity apart from demanding safe drinking water, RTE in schools which have teachers in the vicinity, Need for more Primary Health Care Centres with proper medical staff, Disruption in supply of ART and TB medicines, and other such things which relate to Right to life under Article 21 of the constitution.

      The above are legitimate non-political advocacy matters and any NGO worth its name does highlights these points.Any rightful, and peaceful dissent must be accepted in a Democracy.  Even protesting against Nuclear Plants in Earthquake prone areas or damaging the environment by cutting down trees, ousting the original residents of forest areas or displaced due to setting up Dams without giving proper land as compensation are issues which any decent NGO will take up and protest. These are  Human Rights issues and not political issues.
      I could go on but it seems to me that they are trying to choke any criticism or legitimate dissent against violation of Human Rights and Right to life. Please address these in a diplomatic manner.

      Thank you ever so much,

      Siddhartha,-
      Director, AAG

                
                
            Durgashanker Nagda,   Apr 05, 2011
           
                   Very True, Siddharath ji. Asking any question to the government for the welfare of humanity is NOT politics. Is there a real demnocracy or "Loktantra/ Prajatantra" in India? Ask the common praja or lok in India's 80% of population in villages.
                    Reply
           
         
           17    M.S. Raju,     Apr 01, 2011
         
                 
        To,
        AccountAid Team

        Thanks.  We will be extremely grateful  and it help our understanding if you clarify :
         
        Is there any point of going to DC FCRA requesting for softening the rules? and Did  FCRA section invite comments by 31-03-2011 ?
         
        Regards
        M.S. Raju
        Vision Aid
                  
                  
              AccountAid Team,   Apr 01, 2011
             
                     Thanks. Yes to both your questions.
                      Reply
             
           
             16    Durgashanker Nagda,     Apr 01, 2011
           
                    Dear fellows at the Karmayog:
           
          Thank you for your email.   I will review the entire proposed FCRA rules and send them my comments with a copy to you.  I will also post these comments at the site advised by you.  I do admire your efforts, dedication and sweat to improve conditions back home.
           
          The only thing I can not do is to mail a hard copy of my comments to them as I am out of the country and it shall not reach them before their due date of March 30, 2011, as it takes 15 days to get the snail mail from the USA to New Delhi.  I spend 6 months in India and 6 months in the USA. May I therefore request you to please mail a hard copy of the letter addressed to the FCRA which I will send to them by email at ds-fcra@nic.in with a copy to you?
           
          Thank you for your favor.  Although honestly there should be no need of a hard copy when we can work by written emails in case the Governemtn of India do not trust the word of mouth via telephones or in person.  There seems to be no TRUST there anyway, as NObody trust nobody in our sweat loving motherland -India.  In the United States of America most works are done by computers with email, telefax and telephones. Only when it is absolutely necessary to be present physically then we submit the hard copy in legal courts etc.  Thanks again for the good work you fellows are doing.
           
          With best wishes, and regards,
          Sincerely, DS  
                    
                    
             
               15    M.S. Raju,     Apr 01, 2011
             
                     

            Dear All
             
            Ground reality is that FCRA 2010 bill and act have  received Parliament approval and even consent of President. Rules will now be formed by FCRA  and the new Act as well rules will be   published At this stage one could only ask for softening of the rules by FCRA section if they oblige  . So we have moderated our response and have sent a messsage and leter. If you can , please supportb in similar lines

            M.S. Raju
            Vision-Aid Charitable Services Society

            -----------

            Attachment copy as follows:

            22-03-2011

            Deputy Secretary (FC)
            Ministry of Home Affairs FCRA Wing, Jaisalmer House
            26, Mansingh Road ,New Delhi 110 011 

            ( By e-mail d/ 22-03-11  to ds-fcra@nic.in and hard copy by Registered Speedpost d/ 23-03-11)

            Sir

            Sub: Proposed changes in FCRA rules

            We understand you invited comments of stakeholders, on the proposed FCRA rules 2010/2011

            We are a registered society NGO doing charitable services and hold FCRA registration. We are recipient of National Awards as shown in the masthead above

            It is our concern to comment on those proposed changes that affect our work and it is our duty to comment on such changes that are against public interest

             We submit that some rules need to be re-framed or modified to prevent  

            - encouragement to middlemen&  bad name to your department . 

             -unproductive work for Banks  

            - driving away foreign contributors who sustain  Indian NGOs  

             -shift of  focus  from monitoring  utilization of FC   to  issuing permits

            and

            - complicating   FC procedures in contrast to simplification taking place like IT 80G

             Specific recommendations and justifications are:

            1.     Renewal of Registration (Section 16) 

            This is the harshest change that will be resisted widely and must  be softened           

            Page 2

            NGOs with turnover less than Rs 100 lakh p.a.  who  submit regular  returns and show performance should be exempted from  the necessity of seeking  renewals every 5 years . Otherwise genuine and small NGOs are made to run to Delhi or compelled to feed middlemen

            There is absolutely no need for renewals of performing NGOs .It will only create unproductive work all-round including for you.  For correcting, punishing and weeding out unworthy/ non-performers, you already have annual FC3 reviews and Anytime -suspension or  cancellation powers 

            2.Time limit for processing applications (for Registration)

            Rules should provide for timely intimation with reasons, to applicant in case of rejection and assure “deemed approved” status if no such rejection is made

            3. Subsequent recipients, CBOs (Section 7) 

            Prior permission to transfer FC to field CBOs should be relaxed and exempted up to a limit say Rs 10 lakhs . Field CBOs  are necessarily small and cannot cope up with prior permission regime

            4. Power to reject  (Section 12)

            Rules should exempt “prosecution pending “as valid reason for rejection

            Otherwise false and frivolous prosecutions can ground an NGO

            Yours faithfully

            Vision Aid Charitable Services Society

            M.S. Raju

            Chief Functionary

                      
                      
               
                 14    raj,     Apr 01, 2011
               
                        Dear sir/madam
               
              Some point are drafted for your kind information and comments.  If you have time, please read the points and intimate if any change or addition alongwith your comments at the earliest please.  If you are able to send the comments as appropriate directly to the MHA on the following e mail address or postal address without fail.  Because this is the right time to respond and try to make some genuine changes.  Otherwise, it will create a lot of problem to all the Indian NGOs particularly the rural area NGOs.
               
              Thanks
               
              R.Solairaj.
               
              -------------------
              Attachment copy as follows:

              INTRODUCTION OF FCRA BILL 2011- COMMENTS OF NGOS

               

              Srl No..

              Question

              Remarks

              Comments

              1

              What is FCRA registration?

                               

              Only providing permission to receive FC.  Not giving any fund to the NGO.

               

              If FCRA registered NGOs are not receiving FC after their registration for many year, why Govt. insist them for renewal?  What is the meaning for the renewal of such NGOs?

               

              2

              Are all the FC-3 returns being monitored properly and the NGOs receiving big amount being monitored by security agencies properly, etc?

               

              3

              Why is the renewal of FCRA registration?

              What is the basics of renewal of FCRA registration?

               

              Is it to know/consolidate the FC details received by FCRA registered NGOs for proper monitoring by the Govt? 

               

              If yes, what the Govt. is doing now without consolidating/monitoring the NGOs getting big amount of FC? 

               

              Instead of taking steps to develop systems for effective monitor at district level, Govt. is trying to replicate the work load as well as another layer of rules and regulations between the NGOs and Govt. agencies?  It will surely encourage more corruption/gratification etc and agent through work nature in future at all level.

               

              4

              NGOs receiving FC will be only 10-20% of FCRA register NGOs.  Out of these 10-20% only 2-3 % of NGOs will receive amount more than 1 crore.

               

               

              If the Govt. will try to consolidate these details of  the FCRA registered NGO ****(year wise)  as per the following format, some facts & figures will be emerged.  On  analysis, we will decide whether it is necessary for renewal of all NGOs in one category (i.e. every 5 years) or otherwise?

               

              5

              From that data, you will analyze and take steps to improve the monitoring   systems at State/District level to monitor these NGOs first effectively (receiving funds more than 50 lakh )

               

              6

              Please don’t disturb the NGOs who are receiving small amount of FC and some who are not yet getting any FC even after getting the FCRA registration (for more than 10-15 years).

               

              7

              If you have no data, first please try to consolidate these data by introducing a new scheme to monitor the Indian NGOs better first, before introducing FCRA Bill, 2011.

              Are you sure, all the FCRA registered NGOs are live, or closed? Please make some system to display all the NGOs registered under FCRA with its registration number, correct address and its field of service, areas /location first for common public.

               

               

              8

              There will be a amount specific renewal system?

               

                   

               

              After every 3 years  -  receiving FC amount more than 1 crore in one financial year

               

              After every 5 years - FC amount between 50 lakh to 1 crore in one financial year

               

              After every 7 years -   FC amount between 25 lakh to 50 lakh in one financial year                      

              After every 10 years     -   FC amount below 25 lakh  in one financial year

               

              9

              When your system is dealing the cases for several years in some cases, why the Govt. is trying to replicate its work at this stage?  This type of renewal system will be implemented only after making all type of on-line services as well as making compulsory for NGOs to apply for any project only through on-line.

               

               

              10

              Is there any simple guideline/ booklets issued to the NGOs at the time of its initial registration or FCRA registration?

               

              Nobody is there to guide NGOs properly.  For getting guidance, NGOs are paying a good amount for consultancy, but it goes vain.

               

              11

              Are there any Govt. set up is providing guidance/consultancy for the Indian NGOs?

               

              No. Please provide improvised technology for getting guidance/ training on the basic things (at State/ District level) like, filing of IT return, maintaining NGO Accounting, 12A, 80G & FCRA registration etc and filing FC-3 return.

               

              12

              Can the Indian Govt. will introduce some criteria for releasing some schemes to the Indian NGOs who are running their NGO for a real cause on the basis of the NGO’s life (i.e. after 5 year or 10 yrs of running NGO, they must qualify for receiving some specific projects in future)?

              On the basis of NGO’s age, i.e. 3 yrs or 5 yrs or 10 yrs or 20 yrs & above 20 years (small fixed amount schemes on basic needs of the area & on successful compliance they will eligible for the next project)

               

              13

              Are you having any e-mechanism to issue instructions/information to all Indian NGOs in one lot?

              Presently no e-mechanism is available with Govt.  

               

              14

              Please analyze the Restoration of FCRA registration case in which more than 7 thousand NGOs were put under prior permission category erroneously.  Even now, there are a lot of NGOs are not aware about the Government’s decision for restoration.  On that case, please try to plug the actual figures of restoration application received/ processed/ restored/not yet applied.  That figures will give you a factual position of problems of handling of a large number of applications/ existing system to deal & the procedure which is being adopted etc.

               

              15

              After studying these issues it is a must to make a automated system for guidance of Indian NGOs

               

               

              16

              Is the fee is essential for renewal of FCRA registration? For what?

               

               

              Is the fee is charged to recoup the expenditure on printing the certificate & postal charges?

              Please consider the expenditure to make the DD by the NGO /Bank and postal charges, maintenance of record of DD and its collection, maintenance of cash book, payment to the printing press/correspondence & auditing etc is also involved in collection of the fee Rs. 500/-.  Please examine in this aspect.  NGOs are doing social work & to keep the culture live.  Don’t make the social service as a Business please.

               

               

              **** Table for Q-4

              Nomenclature

              Year

              Year

              Year

              Year

              No. of FCRA registered NGOs

               

               

               

               

              No. of NGOs submitted FC-3 return

               

               

               

               

              No. of NGOs submitted NIL report on FC-3 return

               

               

               

               

              No. of NGOs not submitted FC-3 return

               

               

               

               

              No. of NGOs received FC amount

              Above one crore

               

               

               

               

              No. of NGOs received FC amount

              Between 50 lakh to  one crore

               

               

               

               

              No. of NGOs received FC amount

              Between 25 lakh to 50 lakh 

               

               

               

               

              No. of NGOs received FC amount

              Between 10 lakh to 25 lakh 

               

               

               

               

              No. of NGOs received FC amount

              Between 5 lakh to 10 lakh   

               

               

               

               

              No. of NGOs received FC amount

              Between 3 lakh to 5 lakh     

               

               

               

               

              No. of NGOs received FC amount

              Between 1lakh to 3 lakh     

               

               

               

               

               
              R.Solairaj.

                        
                        
                    M.S. Raju,   Apr 05, 2011
                   
                           Dear Karmayog
                   
                  I feel you should conclude this now by  putting out  out advisiory as under
                   
                  If you have not sent alfrerady comments to DS FCRA please do so immediately by email and more importantly by post
                   
                  In any such a  comminication , please identify yourself as a stake holder and use constructive  non-emotional wording so that the  FCRA guys do not trash it
                   
                  The ground reality  is that the Act is passed and consented. Only minor concessions and softening  are possible, and can be asked in the "Rules "
                   
                  (1)The most important common grievance all of have is Mischief that can be created by the "Renewal"clause

                  (2) Whatwe can ask is Exempt those who send returns, those who atre small scale <Rs 100 lakh
                   
                  Most Sinicerely
                  M. S. Raju
                  President Vision Aid Charitable Services Society
                            Reply
                   
                 
                   13    E E Mahad,     Apr 01, 2011
                 
                         

                Pl. see attached file

                 

                Page No. Clause  No.

                Comment on the draft FCRA Rule – 2010

                Remark

                5/6

                1.00 lakh limit be waived as it is to be abused by registering multiple agencies.

                 

                 

                7/8

                Activities to be debarred  may include in contravention of Act. Specifically.

                 

                 

                7/8(2)

                Append(d), publish in local daily news paper if  a,b,c failed.

                 

                 

                8/9©

                Six months be waived off in eligible reasons for cessation of previous application.

                 

                 

                8/9(a)

                All correspondence be made through identifiable papers instead of plain paper,  otherwise tripartite abuse is possible.

                 

                 

                10/2(b)

                30 day true limit be extended for valid reasons,  if put forth by applicant.

                 

                 

                10/2(e)

                Replace plane paper by identifiable document.

                 

                 

                19/3

                Six months period be waived for valid reasons.

                 

                 

                11/4(a)(b)

                Fees seems to be on higher side may be looked in to reduce it,  being applicant looks for aid.

                 

                 

                20/(23)

                Provision likely to be abused hence review may be taken whether to be provided in draft.

                 

                 

                 

                 E E Mahad

                          
                          
                   
                     12    Fr. Wilfred Lobo sj,     Apr 01, 2011
                   
                           

                  Sir,

                  Kindly find in the attachment an appeal made by the Jesuit Treasurers from all over India with regard to FCRA 2011.

                  I will be much obliged if you kindly consider the recommendations proposed by our conference.

                  Fr. Wilfred Lobo sj
                  Convener
                  Conference of Jesuit Treasurers

                  ------------
                  Attachment copy as follows:

                  AN APPEAL FROM THE NPO SECTOR TO HON’BLE HOME MINISTER FOR RECONSIDERATION OF KEY CONCERNS IN DRAFT FOREIGN CONTRIBUTION (REGULATION) RULES 2010

                  Hon’ble Sir,

                  The Home Ministry has released the Draft Foreign Contribution (Regulation) Rules 2010. There are few harsh and unsustainable clauses in the proposed Rules. If the proposed Rules are enacted, then the NPO sector will be very adversely impacted. There are certain clauses which not only lack rational basis but are against the provision of the FOREIGN CONTRIBUTION (REGULATION) ACT, 2010. The key concerns are as under :

                  DECLARATION OF AN ORGANISATION TO BE OF A POLITICAL NATURE

                  1.01 The proposed Rule 3 provides the guidelines for declaring an organisation to be of political nature. The various grounds for judging an organisation to be of political nature are provided in the Rule enclosed herewith, however there are few clauses which are ambiguous and may create unwarranted problems to the NGOs.

                  1.02 The Rule 3(iii) provides that an organisation can be declared of political nature if it has objectives of political nature OR comments upon or participates in political activity. It may be noted that the word OR is used between political objectives and comments. In other words, even commenting on a political activity may render an organisation to be of political nature. This is a very serious and unconstitutional provision which directly infringes the constitutional right to speech and have independent opinion. Therefore, providing such unfettered powers to the FCRA department is totally unwarranted and this rule needs to be reconsidered.

                  1.03 Rule 3(v) is again a very absurd provision, it provides that any NGO may be deemed to be of political nature if its objects or activity are towards larger socio-economic or political interests of the organisation. The text of Rule 3(v) is as under:
                  “(v) Organisation of farmers, workers, students, youth etc. based on caste, community, religion, language or otherwise, which are not directly aligned to any political party, but whose objectives as stated in the Memorandum of Association or activities, gathered through other material evidence, include steps towards advancement of larger socio-economic OR political interests of such groups.”

                   It may be noted that the word ‘or’ is used between ‘socio-economic or political interests’. In other words, even having socio-economic goal may render an organisation to be a political nature. This clause is absolutely uncalled for and needs to be redrafted.

                  1.04 Rule 3(vi) is provides that actions like ‘bandh’ or ‘hartal’ etc. shall be considered as political action. The text of Rule 3(vi) is as under:
                  “(vi) Any organisation by whatever name called, which habitually engages itself in or employs common methods of political action like ‘bandh’ or ‘hartal’ or ‘rasta roko’, ‘jail bharo’ etc in support of public causes.”

                  1.05 In clause (vi) above some of the common methods like ‘bandh’ or ‘hartal’ or ‘rasta roko’ may be considered as activity of political nature. However, it is important to clarify that peaceful and non violent manner of public protest should not be included. Some examples of peaceful and non violent social action could include ‘rally’, ‘public meetings’ and other methods of awareness building. Therefore, an additional proviso should be added to rule 3(vi) clarifying that it would not apply to peaceful and non violent manner of public protest and social action including ‘rally’, ‘public meetings’ and other methods of awareness building.

                  1.06 RECOMMENDATION: The Rule 3(iii) should be redrafted and the provision which prohibits even commenting on a political activity should be deleted.

                  1.07 The Rule 3(v) should be redrafted, as advancement of ‘larger socio-economic interest’ cannot be considered as a political activity. This rule has the potential create hardship and suppress constitutionally valid and non violent ways of social work. Many NGOs work on the economic development of poor and deprived communities and such clause may adversely affect such work. Therefore, the phrase “larger socio-economic” should be deleted.

                  1.08 The Rule 3(vi) should provide an additional proviso clarifying that it would not apply to peaceful and non violent manner of public protest and social action including ‘rally’, ‘public meetings’ and other methods of awareness building.

                  SPECULATIVE ACTIVITIES

                  2.01 Rule 4 specifies the circumstances under which an investment could be treated as speculative in nature.

                  2.02 Rule 4(1) (a) prohibits investment in shares & stocks even through mutual fund. This provision is in conflict with section 11(5) of the Income Tax Act which provides investment in certain stock linked mutual funds.

                  2.03 Rule 4(1)(b) prohibits investment in land if it is not directly linked to the declared aims and objectives of organisation. This provision again is harsh and ambiguous, because it will be very difficult to make distinction between investment in land in relation to the objectives and otherwise. In fact, NGOs cannot invest anything beyond the objectives. All investments have to be towards fulfillment of the long term objectives. Further it is ironical that this provision has been kept under the head “Speculative Activities” as historically investment in gold or land has never been considered as speculative or prone to high risk.

                  2.04 The Income Tax Law in any case does not allow accumulation of income. Under the current law 85% of the income has to be applied for charitable purposes. The proposed Direct Tax Code (DTC) provides that 100% of the income needs to be applied for charitable purposes. In such circumstances, the possibility of making investments from current year income has been already curtailed. However, the corpus fund or corpus donation can be invested under various options available section 11(5) of the Income Tax Act. The FCRA department should understand that such irrational rules may create hardship to genuine NGOs even in investing their corpus funds into land and building.

                  2.05 RECOMMENDATION: The Rule 4 should distinguish between a corpus or long term investment and investment made out of current year’s income.

                  2.06 The Rule 4 should be in consonance with the section 11(5) of the Income Tax Act. The conflict between these two statutes will create undue hardship to the NGOs.

                  2.07 The Rule 4(1)(b) which prohibits investment in land, treating it as speculative in nature, should be deleted. Linking purchase of land with speculative activity may not serve the purpose of this section, because speculative investments are generally short term with possibility of high fluctuation. Land does not fit into the criteria of speculative investment. Further, linking or delinking land with the objectives of the trust may not be practically possible and will create needless disputes and controversies.

                  ADMINISTRATIVE EXPENDITURE

                  3.01 Rule 5 defines “Administrative Expenditure”. It may be noted that section 8 of the Foreign Contribution (Regulation) Act 2010, (FCRA 2010) provides that the administrative expenditure shall not exceed 50% of the total utilisation.

                  3.02 The definition of Administrative Expenditure briefly is as under :
                  - Remuneration and other expenditure to Board Members and Trustees
                  - Remuneration and other expenditure to persons managing activity.
                  - Expenses at the office of the NGO
                  - Cost of accounting and administration
                  - Expenses towards running and maintenance of vehicle
                  - Cost of writing and filing reports
                  - Legal and professional charges
                  - Rent and repairs to premises

                  3.03 The Rule further provides that the following salaries shall not be considered as administrative in nature :
                  - Salaries of personnel engaged in training or for collection or analysis of field data of an association primarily engaged in research or training (1st proviso)
                  - Expenses related to activities for example salaries to doctors of hospital, salaries to teachers of school etc. (2nd proviso)

                  3.04 This Rule regarding administrative expenditure is highly ambiguous and shall result in lot of controversy and undue hardship. The major contentious issues are as under :
                  - Rule 5(ii) provides that any kind of remuneration cost of travel of persons engaged in management of activities shall be considered as administrative in nature. This Rule is irrational and in contradiction to the second proviso which provides that expenses related to activities shall not be treated as administrative expenditure.
                  - Rule 5(iii) provides that expenditures related with the office of the NGOs shall be treated as administrative in nature. This Rule is irrational and in contradiction to the first proviso which provides that expenses related to training and research shall not be treated as administrative expenditure.
                  - Rule 5(v) provides expenses towards running and maintenance of vehicles shall be treated as administrative in nature. This Rule again is irrational as for most of the programme activity, expenditure towards running and maintenance of vehicles will be incurred. Further, this rule is totally unwarranted in the light of Rule 5(i) which excludes travel expenditure of the board and executive members.
                  - Rule 5(viii) provides that rent and repair of premises shall be considered as administrative expenditure. This rule again is irrational because all programme persons and activities also require premises and the expenditure related with it.
                  - The first proviso to Rule 5 provides that expenditure related with persons engaged in data collection, research or training shall not be treated as administrative expenses. In other words, as per this proviso the expenditure pertaining to all other programme staff shall be treated as administrative expenditure unless otherwise excluded under this rule.
                  - The second proviso to Rule 5 provides some relief from the provisions of the first proviso. It states that all expenses incurred directly in furtherance of the objectives of the organisation shall be excluded. In this context it may be noted that an NGO legally cannot spend a single rupee which is not towards the furtherance of the objectives. Therefore, this proviso in some sense nullifies the earlier provisions of the rule.

                  3.05 RECOMMENDATION : Rule 5(ii) should be deleted as it is in contradiction to the second provision which provides that expenses related to activities shall not be treated as administrative expenditure. Moreover, persons engaged in management of activities should be considered as programme staff and therefore, there is no need for this clause in the rule. It may further be noted that rule 5(iv), (vi) & (vii) cover all the expenditure of administrative, accounting, legal etc. in nature.

                  3.06 Rule 5(iii) which provides that expenditures related with the office of the NGOs shall be treated as administrative in nature should be deleted. This Rule is irrational and in contradiction to the first proviso which provides that expenses related to training and research shall not be treated as administrative expenditure. The FCRA department should appreciate that training and research activity generally would happen within the office infrastructure of the NGOs and therefore, such conflicting provisions should be deleted.

                  3.07 Rule 5(v) which provides expenses towards running and maintenance of vehicles shall be treated as administrative in nature should be deleted. This Rule is irrational as for most of the programme activity expenditure towards running and maintenance of vehicles will be incurred. Further this rule is totally unwarranted in the light of Rule 5(i) which excludes all expenditures including travel of the board and executive members.

                  3.08 Rule 5(viii) which provides that rent and repair of premises shall be considered as administrative expenditure. This rule is irrational because all programme persons and activities also require premises and the expenditure related with it. Nowadays the work of NGOs mostly involve research and advocacy related issues where the major component of expenditure is on programme personnel working from various locations.

                  3.09 The first proviso to Rule 5 provides that expenditure related with persons engaged in data collection, research or training shall not be treated as administrative expenses should be redrafted and the expenditure pertaining to all other programme staff should be covered under this rule.

                  CONTRIBUTIONS RECEIVED FROM RELATIVES

                  4.01 Rule 6 provides that foreign contribution, received from relatives, in excess of `1,00,000/- in one financial year should be intimated to the Central Government in Form FC-1 within 30days of such receipt. In this regard it should be noted that Section 4(e) of the FCRA 2010 clearly exempts contributions received from relatives for all category of persons. Therefore, this rule is in contravention of the Act and legally unsustainable.

                  4.02 RECOMMENDATION : Rule 6 regarding intimation of receiving foreign contribution from relatives should be deleted because it is in direct contravention with section 4(e) of the FCRA 2010. The rules cannot go beyond what has been mandated in the Act.

                  APPLICATION FOR
                  OBTAINING ‘REGISTRATION’ OR ‘PRIOR PERMISSION’

                  5.01 Rule 9 now clarifies that all application for registration or prior permission have to be made both electronically online and hard copies also have to be sent within 30days of online submission.

                  5.02 Rule 9 also clarifies that organisations can open multiple bank accounts for utilisation purposes. However, an intimation in plain paper have to be furnished to the FCRA department within 15days of opening of such bank account. It may be noted that separate intimation for each bank account has to be sent. Providing a list of bank account with FC return will not suffice.

                  5.03 Rule 9(3) provides that a second application for prior permission should not be accepted within three months of submitting the application. This provision should not apply if the organisation is applying for prior permission for another fresh project.

                  5.04 RECOMMENDATION : The Rule 9(3) should be suitably amended to allow second application for prior permission for a separate project. The time gap of 3 month between 2 prior permission applications should apply only if the application is made for the same project.

                  CUSTODY OF FUNDS AND ASSETS IN THE EVENT OF CANCELLATION

                  6.01 Rule 14 provides the procedures regarding the custody of foreign funds and assets in the event of cancellation.

                  6.02 In case of the available bank balances the respective banking authority will become the custodian till the Central Government issues further directions.

                  6.03 If funds have been transferred to another NGO after cancellation, then the funds in the bank account of such NGO will also go to the custody of the banking authority.

                  6.04 All other assets of the organisation whose certificate has been cancelled or has become defunct shall go to the interim custody of the District Magistrate or any other authority which the Central Government may direct. This provision is extremely irrational and unfair, because the direction for repossession of asset should only be issued when all appellate remedies are exhausted. This provision will needlessly create legal litigations with NGOs going for writ applications before various High Courts.

                  6.05 RECOMMENDATION : Rule 14 requires immediate reconsideration. The provision of taking custody of assets as an interim measure needs to be deleted. The assets should be repossessed only after all appellate remedies are exhausted. Further, there is a possibility that the certificate may stand cancelled due to small procedural lapses also, (for instance an organisation may make delay for justifiable reasons in applying for renewal of registration). Therefore, it is important that it is also clarified that the punitive provisions shall apply only if the registration certificate is specifically cancelled under section 14 of the FCRA 2010, after providing a reasonable opportunity.

                  REPORTING BY BANKS

                  7.01 Rule 15 provides that the bank should report to the FCRA department within 30 days under two circumstances (i) if any foreign contribution is received without registration or prior permission, (ii) if foreign contribution in excess of rupees 1 crore during a period of 30 days, this rule will apply to all FC funds received through valid registration or prior permission.

                  7.02 RECOMMENDATION : The Rule 15(3) provides that the bank should report within 30 days if 1 crore or more is received in one or more transaction within a block of 30 days. This rule should be redrafted and be made applicable for transaction pertaining to 1 calendar month instead of any 30 days.

                  TRANSFERING FC FUNDS TO EVEN REGISTERED
                  ORGANISATIONS THROUGH PRIOR APPROVAL

                  8.01 Rule 23 provides that an organisation should apply on Form FC-10 for transfer of FC funds to registered organisations. This is a radical shift and will affect the work of many charitable organisations. If this rule comes to force then the work of most of the apex level and network organisations will be jeopardized as they will not be allowed to transfer funds to other FC registered organisation without prior approval. Currently transfer of FC funds to another FC registered organisation is permissible without prior approval. In fact, Section 7 of FCRA 2010 clearly provides that transfer to another FC registered organisation is permissible. The text of Section 7 is as under:
                  7. No person who —
                  (a) is registered and granted a certificate or has obtained prior permission under this Act; and
                  (b) receives any foreign contribution, shall transfer such foreign contribution to any other person unless such other person is also registered and had been granted the certificate or obtained the prior permission under this Act:
                  Provided that such person may transfer, with the prior approval of the Central Government, a part of such foreign contribution to any other person who has not been granted a certificate or obtained permission under this Act in accordance with the rules made by the Central Government.

                  8.02 The above section clearly provides that transfer of funds is possible, without prior approval, if the subsequent receiver has been granted the certificate of registration or obtained the prior permission under this Act. Therefore, Rule 23 is totally unwarranted and legally unsustainable. It is a well established law that Rules cannot be framed beyond the mandate provided in the Act, neither can a rule have an overriding effect over the provisions of the Act.

                  8.03 RECOMMENDATION : The Rule 23(1) & (2) should be deleted as they are in direct contravention of the Section 7 of FCRA 2010 which allows transfer of funds, without approval, if the subsequent receiver has been granted the certificate or obtained the prior permission under this Act.

                  TRANSFERING FC FUNDS
                  TO UNREGISTERED ORGANISATIONS

                  9.01 Rule 23(4) provides that an organisation may apply in Form FC-10 for transfer of FC funds to unregistered organisations. Such transfer could be made to multiple recipients through one prior approval. However, the total amount of transfer to unregistered organisation shall not exceed 10% of the total foreign contribution received.

                  9.02 In this context it is important to note that it is extremely difficult for village level CBOs and SHGs to have FCRA registration and therefore, this provision is a very welcome change. However, FCRA department should consider providing general approval for small amounts to village level organisation. Such move will help the money go to the grass root level and will enhance the effectiveness of development programmes.

                  9.03 RECOMMENDATION : The Rule 23(4) should be redrafted and a general permission should be provided for transfer of fund to a small village level organisation upto certain limit, say, 1 lakh rupees per year. As it is practically not possible to get prior approval for small legitimate transfers. Absence of any such provision would obstruct flow of funds to the grassroots level.

                  Fr. Wilfred Lobo sj

                            
                            
                     
                       11    Dr. M. Shyam,     Apr 01, 2011
                     
                              Dear Sir,

                    This is regarding the draft Foreign Contribution (Regulation) Rules 2011.  The suggestion of Sardar Patel Renewable Energy Research Institute is as follows :

                    “The non-governmental institution mandated for scientific research/teaching or both, primarily for upliftment of the society at large, should be exempted from seeking registration/prior permission for receiving donations/grants/fees, etc. from foreign organizations to provide consultancy, services, technology, etc. purely for scientific purposes or development of the society in the concerned countries.  However, a system should be put in place so that such organizations submit returns of the grants/donations/ fees, if received, at the end of the year to the MHA.  This provision should be applicable to the NGOs, which have been approved by Department of Scientific Industrial & Research, Govt. of India as Scientific and Industrial Research Organization”.

                    Thanking you,

                    Dr. M. Shyam

                    Director, SPRERI

                              
                              
                          Durgashanker Nagda,   Apr 01, 2011
                         
                                 Why for Scientific work only every NGO is helping and doing some or the other humanitarian work, so the same should apply for all NGO. Science has already done this much damage.
                                  Reply
                         
                       
                         10    Siddhartha Vatsyayan,     Apr 01, 2011
                       
                               

                      Dear sir,

                      Greetings from AAG!

                      We, with the help of our CA, Mr. Arun Bhatia, found some of the lacunae in the draft FCRA Rules. May be there are other issues that can be added.
                      I request all addressees to study the rules and comment if required.
                      With best regards,

                      Siddhartha Vatsyayan

                                
                                
                         
                           9    Surya Prakash Loonker,     Mar 31, 2011
                         
                                 

                                                                                                    30 March 2011
                        To

                        The Deputy  Secretary FCRA Division
                        Ministry of Home Affairs
                        Government of India
                        New Delhi

                        Dear Sir,

                        Just like FERA was replaced by FEMA. It is time FCRA is completely scrapped and replaced by FCMA – Foreign Currency Management Act. I think NGOs should be given same treatment as given to Companies. We need to trust our NGOs. If someone wants to misuse funds, it is easier to do it through a company. Why would one bother forming a NGO and get a FCRA? Companies can receive foreign money without even intimating RBI. It is time MHA pays attention to companies and MNCs and stop hassling NGOs for no reason whatsoever. Management is required, not Regulation. So please draft FCMA on lines of FEMA and replace FCRA.

                        Now, all registrations for NGOs is one-time and permanent including 80(G). So there is no reason for FCRA registration to move backwards from permanent to one requiring renewal every  5 years. FCRA registration must remain permanent and both FCRA and Prior Permission must be granted in 2 months. 3-4 months is a long time in this internet age. Also, FCRA granting has no time limit right now and it takes even 1-2 years to get it.

                        Surya Prakash Loonker
                        A-8 Mandakini Enclave, Alaknanda, New Delhi - 110 019.  INDIA.
                        T: +91-11-40533711

                         

                                  
                                  
                              Durgashanker Nagda,   Mar 31, 2011
                             
                                     Good point. How can one send foreign money to a 80G approved registered society -NGO, for charity in India through a company? Please advise. Also you are recommending 2 months but the MHA takes over one year for granting prior permission and not saying yet YES or NO. Clearly the government is NOT working. Correctly you said, India needs honest management and not regulations. Laws can only be enforced when morally sound people are there in the government at all levels -chaprasi, patwari, tehsildar, collector, police, CBI, MHA, or any office bearers because only PEOPLE men and can men these offices.
                                      Reply
                             
                                Surya Prakash Loonker,   Apr 01, 2011
                               
                                       How can one send foreign money to a 80G approved registered society -NGO, for charity in India through a company?

                              You cannot. I was saying that if someone wants to fund for terrorism, personal gains, crime etc, it is easy for them to route the funds through a company. Why would they use a NGO to route funds to be used for illegal purposes. Main purpose of FCRA being to check crime and political funding, in today's age, FCRA is not required as people who are doing such activities will use companies (as it is easier to do so) and not NGOs for routing funds. I hope it is clear now.

                              I am recommending that FCRA and PP be both either be issued in 2 months and if FCRA sends no positive or negative response within 2 months, once 2 months are over NGO should automatically assume that they have received FCRA. Why should NGOs suffer for lethargy or laziness of clerks and bureaucrats. I am talking about implementing Public Services Guarantee Act at national level.
                                        Reply
                               
                           
                             8    Dr. G. Umashankar,     Mar 25, 2011
                           
                                   

                           To

                          The Deputy Secretary FCRA

                          Ministry of Home Affairs

                          Government of India

                          S. NO

                          Areas

                          Expectations

                          1.

                          Application

                          It is pleaded that the certificate from the receiving authority may be deleted

                          2.

                          Declaration and understanding

                          It is pleaded that the clause ii of the declaration and understanding may be deleted

                          3.

                          Declaration of an organisation of political nature not being political party:

                          The definition may be re-drafted by taking in to consideration of the views.

                          4.

                          Administrative expenses:

                          The pure administrative cost alone has alone to be included and this may be re-drafted,

                          5.

                          Procedure for transferring foreign contribution:

                          The transfer may happen only with the information to the Ministry instead of talking permission as contemplated. The existing procedure for approved organisations should continue

                          6.

                          Registration after every five years

                          Since FC returns are available a simple letter of request may be obtained  and approval may be given

                                    
                                    
                             
                               7    Durgashanker Nagda,     Mar 23, 2011
                             
                                      To The Deputy Secretary (FC) Ministry of Home Affairs, FCRA Wing Jaisalmer House, 26, Mansingh Road New Delhi Via: ds-fcra@nic.in ; cc: info@karmayog.org Sub: Comments on Proposed FCRA Rules -2011. Dear Deputy Secretary Thank you for revisiting existing FCRA Rules and thanks to Karmayog organization to make me aware of the proposed changes. I admire your efforts to improve and streamline the process. I have read the entire proposed rules as available at www.mha.nic.in/pdfs/Draft-FC-rules-2011.pdf and all application Forms (pages 1 to 51) and I have the following comments for your consideration: A. Rules: Rule 2 on Page-1, Definitions: In sub-Rule (1) Person (as used in Rule 9 (1)(a) on Page 8) is required to be defined as an individual or entity such as an association, society or Trust. Rule 3 on Page-2,“Guidelines for ------ political party”: In sub-Rule (v): Caste and religion should be deleted. (Explanation: As we all have one Caste –human just like we have one human race or one religion –religion of man kind and one nation India with one national language -Hindi.). Rule 3, sub-Rule (vi) on Page-3, “any organization ------public causes” should be taken out as a support of public cause and public well being is not political. Would that not impinge on freedom of speech and constitutional rights of an individual citizen of the organization? Rule 4 on Page 3 and 4 is questionable? What is the motive in asking for this information? Speculations are baseless and unfounded, hence Rule 4 should be deleted. Rule 5 on Page 4 and 5, Administrative Expenses: Expenses mentioned in sub-Rule (i) to (viii) including two exclusions for the provisions must be counted towards charity because without which any charity can not be performed. Would this not be like asking a person to swim without getting wet? How can one have a school or orphanage without a building whether rented or built, without repair, without utilities and telephone, without salaries of staff, etc.? Consequently the certificate on Page 30 of FC-3 needs to be revised to reflect above by deleting “(excluding administrative expenditures)”. Rule 9: On Page 8, sub-Rule (1) (a) “Any application----- of a person ----required documents.” Either “or an association, a registered society or trust” should be added after person or a person should be defined in Rule 2, Definitions (see item 1 above). On Page 9, sub-Rule (1) (c), and on Page 10 sub-Rule (2) (c) should be deleted and replaced with file another on line application as per (1)(a) or (2) (a) as the delay in submitting a hard copy does not eliminate the cause and purpose of requesting electronically. Eventually the requirement of submitting hard copy per item (1) (b) or (2) (b) may be abolished in the interest of reducing or eliminating paper work as more and more business is done on line and more and more trust is developed between people -applicants and reviewers. On Page 11, sub-Rule (4)(c) in Line 2, on Page 12, Rule 11 (4) in Line 3, on Page 19, Rule 19 and 20, etc.: Should it not be “Pay to Account Officer” instead of “Pay and Account Officer? Rule 11, on Page 12, sub-Rule (2): “The Ministry shall provide a notification to the applicant 60 days prior to the requirement of applying for renewal (under this sub-Rule) with their requirements or any changes in law” should be added at the end; i.e., on 30 April 2015 as given in illustration given is sub-Rule (5) on Page 13. Rule 14, on Page 15, in sub-Rule (2), clause (a) of Rule 12 was not found. There is no clause in Rule 12 given on Page 14. Rule 15, on Page 16, in sub-Rule (1) the following should be added at the end “The Central Government shall intimate every bank the registration and prior permission granted by the Central Government to any applicant at the time of grant of such registration or prior permission. Rule 16, sub-Rule (7), on Page 18: “For person registered under FCRA” should be added before “A ‘NIL’ ----financial year” as this does not apply to person receiving prior permission when the FC-6 has been submitted with a zero balance and no new prior permission has been granted. Rule 17, on Page 18, should be abolished as the election should be free and without big expenditure. This is necessary to preserve the sovereignty of India and prevent foreign influence in election. The people of India should be honest to elect only honest and dedicated people to represent them without involving expenses in election. This will discourage vote buying, bribery and corruption. B. General Comments: On the Applications (FC1, FC-2, FC-3, FC-4, etc.) and Forms: In Forms FC-1 on Page 22 and FC-2 on Page 23, etc., why a man requires his father’s name and a woman her husband’s name? Will this not be a gender bias and disparity when the Constitution of India does not differentiate between citizens on the basis of gender? Make only father’s name for all, better still if a mother’s name is required then it will be more realistic based on physical proof instead of belief. This was applicable and good in ‘Satyug’ and is not applicable in current time ‘Kaliyug’ so it must change. In Form FC-3, Registration: Item 1 (iii) (a) on Page 25 “religious” must be changed to “spiritual” as India is a secular country per Constitution of India and does not promote religions. Item 9, on Page 27, the words “political nature” is to be deleted, as members of any society will always vote for one or the other political parties until all political parties are abolished and people of good moral character who want to be servants of the society contested or nominated by honest people or public. Also all members of any society will certainly have some political nature. Similarly in Certificate on Page 30 in FC-3 “Religious” in 3rd line under brackets be replaced with “Spiritual”. In the Note 1 on Page 29: “, but every effort shall be done to determine a genuine application by screening it from an scrupulous application and all applications shall be considered without prejudice, bribe, or enticement purely on the merits of their case” be added at the end of the sentence beginning with “Receipt -----is not a commitment ---- Central Government” else it may become a money making process. In Form FC-4, Prior Permission: Item 8, on Page 33, should be deleted especially when this requirement is not there in FC-3 for registration; why it is here? Does this not violate the fundamental rights of a citizen of India ? How this is possible that the members of the association will not read, write or think on the current affairs in the country via any news in print or electronic media? The Certificate on Page 36, Item 3: IN “Grant of registration -----is recommended” should the word “Prior Permission” not replace word “registration”? In Form FC-5 Renewal: Item 6 on Page 37: Can the Central Government be more specific as what it is looking for in the entire FCRA? In Form FC-6, Account of FC: Item 1. (iv), on Page 39, be made consistent with Item 1. iii. (a) of Form FC-3 by replacing “religion” with “spiritual” as suggested in Item 2. a. above Item (v), on Page 39, be deleted in light of above comment a. of this item 5 as it becomes redundant. Item 21, on Page 40, be deleted in light of above comments. In Form FC-9, Candidate for Election: On Page 48, in Item 3. Thank you for giving only the name of the father as commented in Item B. 1.above, as per current practice it indicate that woman will not be allowed to contest an election as their husband’s name is not given, as usual so far? In Form FC-10, Seeking Permission to Transfer ----: On Page 50, why would the PAN # not required of Item 1? Delete Item 2. (i) and 2. (i)(a) as if the recipient association is registered under FCRA then why would the transfer be needed? Finally I like to bring it to your kind attention that any amount of reform in the procedures and rules under the spirit to improve FCRA might be futile unless we the people of India would have the following prerequisites: Capability and competence in distinguishing between an honest applicant and a scrupulous applicant for receipt of FC under FCRA or FCRA Rules. As much as the applicants have to be honest and truthful, the competent authority -in this case the Ministry of Home Affairs (FCRA Wing), local government and investigating authorities, have to be honest, unbiased, and able to see the true purpose, looking purely at the welfare of the citizens of India and the misuse of the foreign contribution if any. The spirit of service by the servants of the society from which they get their livelihood by accepting compensation without delivering goods is realized. Strong moral values and honesty on the parts of both the applicants, and the reviewers or granters –i.e., in this case the government machinery at all levels, is to be inculcated in them. Thank you both again for the opportunity to review the proposed FCRA Rules 2011. I hope you will appreciate the contribution by considering these comments. If you have any questions please let me know at the return email given below. A hard copy is being mailed to you via postal mail. Thank you. With best wishes and regards, sincerely,
                                      
                                      
                                  N Lakshmi Narayana,   Mar 24, 2011
                                 
                                         Congratulations for your efforts in making collaborative exercise. I have made comments on the validity and renewal.

                                Looking forward to get the best out of our efforts and further to work for the development of the people.

                                All the best   
                                          Reply
                                 
                               
                                 6    N Lakshmi Narayana,     Mar 22, 2011
                               
                                       

                              Dear Karmayog,

                              Thanks for the linkage and see the comments made on the draft FCRA a:

                              .................................................................................

                              SUGGESTIONS FOR THE FCRA DRAFT 2011

                              1.      Under: 9. Application for obtaining ‘registration’ or ‘prior permission’ to receive foreign contribution.

                              Any person whose request was ceased under clause (b) of sub-rule (1) may prefer a fresh on-line application with the Central Government only after six months from the date of cessation of the previous application.

                              Suggestion: consider for three month.

                              Explanation: Six months is quite long and applicants will suffer in general and particularly the one from rural villages.

                              2.     Under: 10. Validity of Certificate. - Every certificate of registration granted to a person under the Act shall be valid for a period of five years from the date of its issue.

                              Suggestion:  Retain the old system of validity once for all.

                              Explanation: The process of renewal will take time and money. It will be more difficult for the rural organizations / people. Even the 80G which is valid for three years and needs to be renewed has realized the difficulties and amended for once for all.   Keeping the barriers in the process and the trend of 80G, retain the FRCA validity once for all.

                              3.     Add the Monitoring Mechanism once in 5 years: This is suggested in the place of renewal for an effective monitoring of the contributions received. NIL contributions continuously for 5 years can be viewed separately. This helps the Account holders to put their best efforts for getting the support for the cause for which it was approved.  

                              4.     Under: transferring FC funds to organizations: For the NGOs, CBOs, DPOs and others who are under federation or legally related or jointly operating, FCRA of Federation or mother organization should be considered for receiving contributions and for transferring with transparency. 

                              .....................................................................................

                              Hope the comments are relevant for the acts and its best utility with rights.

                              I was with the government for the period of 20 years and now with NGOs in building their capacities and thus to reach the needy with sustainable solutions.

                              Please update the reflections on this draft including the final

                              Looking forward for better networking and support please.

                              with thanks  

                                        
                                        
                                 
                                   5    Ajoy Kumar Basu,     Mar 22, 2011
                                 
                                         

                                1984,  Animal Farm, Emergency Period  all are same.. The draft violates Human Rights and creates only a coterie of YES-men. Where is liberty of a Cutizen? Or at long last, are we giving up democracy?
                                I am too old to weep for my grand children who will be caged.

                                Ajoy Kumar Basu
                                Chairman,
                                SRI-Ranchi

                                          
                                          
                                   
                                     4    M.S. Raju,     Mar 17, 2011
                                   
                                           

                                  Sir
                                   
                                  Sub: Proposed changes in FCRA rules

                                  We are a registered society NGO doing charitable services and hold FCRA registration . We are recipient of National Awards as shown in the masthead above
                                   
                                  It is our concern to commernt on those proposed changes that  affect our work and it is our duty to comment  on such changes that are against public interest
                                   
                                  Accordingly, most  respectfully we submit that many of the    proposed changes in FCRA rules as drafted need to be dropped outright , as these are likely to bring corruption, encouragement to middlemen,  inefficiency and bad name to your department .
                                   
                                  They may drive away foriegn contributors who sustain  Indian NGO  charitable organizations
                                   
                                  They would create unproductive work for Banks 
                                   
                                  They are against the spirit of the Act They are sure  to be contested in media, courts, fora, industrty  interactions, courts and Parliament 
                                   
                                  The changes shift the  focus of  the government  from monitoring  utilization of foreign contributions  to  issuing permits
                                   
                                  They set back to cetrtain extent,  liberalization  and globalization and transperancy ,the awowed National objectives
                                   
                                  While other wings of the government are simplifying procedures , like  Income Tax doing away with   with returns, renewals of 80 G  etc, the  proposed FCRA changes tend to complicate even the existing  procedures
                                   
                                  We oppose thse and request you humbly and ernestly  to drop them. Kindly do go through the following specific, valid and factual reasons . We can prove every point mentioned below
                                   
                                  General 
                                   
                                  1. The existing rules are adequate to control the bad guys but give protection for the genuine parities with  Registration being permanent , provision for auotmatic and deeemed approval in case of delays by the department . Now the changes proposed create several new  forms, need to approach and disturb your department  periodically. They will create work for you and will be a bonanza for middlemen
                                   
                                  2. The  Act and existing rules have a fair provision for time bound approvals on applicationhs  for prior permissions andv deemed approval stastus in 90 days .The proposed changes seem to omit the provision from the rules which willl bring in inefficiency  and be uinfair to donors who are  asked to wait indefinitely
                                   
                                  Specific
                                   
                                  3. . Proposed Clause 10  introduces a need to seek  renewal of permanent registration every 5 years.

                                  Existing powers are adequate for FC section to monitor , weed out and  suspend bad performers . The proposed change will make even good NGOs to rush to Delhi  periodically  Middlemen and corruption are likely to grow
                                   
                                  3. Proposed Clauses 9 and 11   introduce Fees of Rs 1000 and Rs 500 for applications

                                  This will harass NGOs ,yet the income will be too small to benefit Gopvt. of India
                                   
                                  4. Proposed Clause 6 introduces prior permission for  inward remittances of > 1 lakh even from relatives

                                  There  are enough ways to monitor inward familoy remittances . Bringing FCRA prior permission into it will encourage even families to seek hawala routes
                                   
                                  5. Proposed Clause 7 introduces Permission to receivev medical treatment  support

                                  Cruel, impractical and will encourage hawala transactions
                                   
                                  Yours faithfully
                                   
                                  Vision Aid Charitable Services Society
                                  M S Raju
                                  Chief Functionary

                                            
                                            
                                        AccountAid Team,   Apr 01, 2011
                                       
                                               Thanks for your message. Kindly note that the bill received President's assent on 27-Sep-10. It only remains to be notified, which will be done after the rules are finalised.

                                      Best wishes
                                      AccountAid Team: www.AccountAid.net
                                                Reply
                                       
                                     
                                       3    Prabir Kumar Talapatra,     Mar 16, 2011
                                     
                                             

                                    The Deputy Secretary,
                                    FCRA
                                    Government of India
                                    New Delhi

                                    Dear Sir,

                                    In respect to the draft FCRA Rules I offer below few suggestions for consideration.

                                    1 The term CONTRIBUTION needs to be clarified means definition of CONTRIBUTION under the ACT need to be made.

                                    2 Monthly remittances from relatives should not come under the ACT -- needs to be clarified
                                      
                                    3 Clause 3(vi) Liability or OTHERWISE

                                    4 Clause 4(3) shall maintain and update

                                    5 Clause 5 (viii) Repairs and maintenances to premises

                                    General : 1) Rupees one lakh seems to be too small an amount in a given year. The amount need to be raised

                                              2) Objective clause for FCRA needs to be added

                                              3) Why not consider some obligations for DONOR to intimate to the AUTHORITY if the CAUSE for such donation is so dear to their heart


                                    Thanks.

                                    Prabir Kumar Talapatra

                                              
                                              
                                       
                                         2    Dr. Hema lata Kulkarni,     Mar 16, 2011
                                       
                                                The non-prfit / Social Benefit organization : ISHAAN HOPE Foundation for Education & Training will be appying for FCRA soon. In case there are stictures on getting grants from foreing countries it will be difficult for us to not only expand our educational work for the underprivilaged, but may have difficulties in continuing our present project.s. Our website is "ishaanhope.com
                                                
                                                
                                         
                                           1    fr, Joseph D"Gama,     Mar 14, 2011
                                         
                                                 

                                        Dear Minister,

                                        Please do not make NGO's to renuee their FCRA account every 5 years because this will increase corruption and bring LICENCE RAJ BACK. NGO's will be harresed  and made to run pillar to post to get FCRA renueed again.

                                        It will be very difficult to come all the way to Delhi and sepend a lot of money to stay in Hotels , and bribe the Babus in the Home Ministry and still our file will not move upward and will lead us to fustration and all the projects of the poor will be closed .

                                        I appeal to Mrs Sonia Ghandi and Rahul Ghandhi to please look in this matter urgently an correct this licence raj that is being brought through the black door

                                        Fr. Joseph D'Gama.