Foreign Contribution (Regulation) Act (FCRA)

Choose the Correct Answer

Correct Answer : Option d

Explanation
Recently, the Government revoked the FCRA licence of Sonam Wangchuk’s organisation.

Statement 1 is correct: Under the Foreign Contribution (Regulation) Act, 2010, non-profit organizations such as NGOs, trusts, and societies are required to obtain FCRA registration or prior permission to legally receive foreign donations. This framework ensures transparency and accountability, mandating that foreign funds are utilized solely for legitimate purposes like education, health, disaster relief, and social welfare.

Statement 2 is correct: Ministry of Home Affairs (MHA) serves as the nodal authority for granting, renewing, suspending, or cancelling FCRA registrations. Under the FCRA (Amendment) Rules, 2020, registrations are valid for five years, and organizations are required to apply for renewal at least six months before expiry to ensure uninterrupted receipt of foreign contributions.

Statement 3 is correct: FCRA-registered entities must open a designated bank account in the State Bank of India, New Delhi Main Branch (NDMB) to receive foreign contributions. They are also required to maintain separate accounts and records for foreign funds and submit annual returns (Form FC-4) to the Ministry of Home Affairs, detailing the amount received, sources of funding, and utilization to ensure transparency and compliance.