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FCRA Renewal Status

How do we know, what is the status of application of FCRA renewal ? This is the question, every organization is asking now a days. Yes, we all are waiting regarding any communication from MHA, FCRA department regarding FCRA renewal status.

What is current scenario?

As per our knowledge, no organization,  throughout India has received any Renewal or Query Letter from MHA, FCRA department.

How to check FCRA Renewal Status?

No such mechanism prescribed or available right now online to check where your application is lying. Keep visiting our blog for any new news.

Time limit for FCRA Renewal?

As per section 16 (3) of FCR Act, 2010, renewal certificate should be issued withing 90 days from the date of the application received.

section 16(3)

“The Central Government shall renew the certificate, ordinarily within ninety days from the date of receipt of application for renewal of certificate . . . .

Provided that in case the Central Government does not renew the certificate within the said period of ninety days, it shall communicate the reason thereof to the applicant”

What to do now?

Organization can email to the FCRA department to ds-fcra@nic.dot.in email address (this email address mention on the fcraonline.nic.in website) with the details on which date you apply for renewal and DD no etc..

If you get any communication from FCRA department regarding renewal or any queries, kindly post in the comment so it will be useful to other readers of this blog. Thanks.

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FCRA and Administrative Expenses

Excess Administrative Expenses – one of the reason to cancel FCRA Registration

FCRA department may cancel your organization registration if you have excessive Administrative and Salary Expenses. Last month, FCRA Department has cancelled registration of SABRANG Trust. In the order regarding cancellation, one of the findings is, administrative expenses were excessive than permitted  by FCRA and no approval was taken. See para 5 of this order.

How much Administrative Expenses Allowed in FCRA?

As per Section 8 (1) (b) of the FCRA, 2010

“shall not defray as far as possible such sum, not exceeding fifty per cent. of such contribution, received in a financial year, to meet administrative expenses:”

So as per FCRA, limit for administrative expenses are 50%.

What is considered as Administrative Expenses?

Definition of Administrative Expenses is given in the Rule 5 of  FCR Rules, 2011. You can read it from here.

Let us interpret this rule.

 

  • As per Rule
  • (i) salaries, wages, travel expenses or any remuneration realized by the Members of the Executive Committee or Governing Council of the person;

     

     

     

  • (ii) all expenses towards hiring of personnel for management of the activities of the person and salaries, wages or any kind of remuneration paid, including cost of travel, to such personnel;
  • (iii) all expenses related to consumables like electricity and water charges, telephone charges, postal charges, repairs to premise(s) from where the organisation or Association is functioning, stationery and printing charges, transport and travel charges by the Members of the Executive Committee or Governing Council and expenditure on office equipment;
  • iv) cost of accounting for and administering funds

     

  • (vi) cost of writing and filing reports;

     

     

  • (vii) legal and professional charges;

     

  • viii) rent of premises, repairs to premises and expenses on other utilities:

     

     

     

  • * This interpretation is Author’s own view and kindly take expert opinion before taking any decisions based on this interpretation
  • Our Interpretation *
  • Any payments to Governing Board Members, Trustees, Exe committee members whether in the form of consultancy, remuneration, honorarium, wages, travel should include in the Administrative Expenses. However, program staff salary and travel is to be considered as project expenses.

  • Any payments to managers or co-ordinators, coordinating activities and persons of the organization should be considered as administrative expenses.

  • All the expenses related to Functioning office are considered as administrative expense. However, expenses related to the premise specifically and exclusively used for the project activities, like Training Centers, Library etc.. are not considered in the administrative expenses.

     

  • Salary of accountant or office support staff and travel and other expenses of them should be considered as administrative expenses.
  • Any expenses related to documentation whether it is consultancy, salary, wages, travel etc.. should considered as administrative expenses.
  • Audit Fees, Advocate Fees, Legal fees should considered as administrative expenses.
  • Rent, Rates and taxes of Admin office and field office should considered as administrative expenses.However, expenses related to the premise specifically and exclusively used for the project activities, like Training Centers, Library etc.. are not considered in the administrative expenses.
  • * This interpretation is Author’s own view and kindly take expert opinion before taking any decisions based on this interpretation

 

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Immediately update your NGO details on FCRA portal

Making all FCRA services online

FCRA department is in the process of making all the procedures online. (read this blog), previously asked NGOs to have digital signatures of Chief Functionary. Yesterday,  FCRA department has issued notification dated July 28, 2015 (download it from here) stating that in order to making all FCRA services online, instructed NGOs to go on FCRA portal and update their details.

Which Procedures becoming online?

  • Application for FCRA registration
  • Application for Prior Permission
  • Application for renewal of FCRA
  • Change Application for Name of Association
  • Change Application for Address of Association
  • Change Application for Bank Account of Association
  • Filling Annual Return

Attachments to any applications

All the documents and attachments for the above procedures will  also to be uploaded in scan copies. No hard copies of such documents accepted by FCRA department.

Payment of Fees

After everything will be online, payment of fees for above procedures will also be accepted only through online payments.

When ?

As mentioned in the above notification, after 15 to 20 days all the procedure will be online.

Immediate action to be taken by NGO – Very Important

FCRA department instructed NGOs to update their information –

1) Go to this link – http://fcraonline.nic.in/dat_col_frame.aspx

2) Enter your FCRA Registration No. , State and District (see below image)

Update_FCRA

3) Update all the information and save data (see image below)

Update_FCRA_details

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FC Grant Now exempt from Charity Contribution – Gujarat

Gujarat Government published in the Official Gazette on May 20, 2015 (Download it from here) regarding change in Gujarat Public Trust Act, 1950 and these rules may be called the “Bombay Public Trust (Gujarat) (Amendments) Rules, 2015. One of the major welcome change is to consider Foreign Grant as deduction for calculation of Charity Contribution.

Earlier, only local contribution/grants and government grants were allowed to deduct from amount liable to contribution. No such provision related to Foreign Grants deduction was there, because of old act since 1950 and never amended thereafter.

Change in Balance Sheet and Income Expenditure format –

Schedule VIII related to Balance Sheet and major change is to show balance in FCRA Bank account separately. Have a look –

charitybS

Schedule IX is related to Income and Expenditure Account  and major change is to show Grants in Foreign Money  separately. Have a look –

charityIE

Change in Schedule IX-C – Statement showing amount Liable to Contribution –

Major relief comes here, where it is notified in this revised schedule of IX-C, that Grant and Donation under FCRA is not chargeable to contribution under section 58 and rule 32. Lets have a look –

charity9C

From when it is applicable –

As no date specified in the official gazette, we interpret that any Statements prepared after May 20, 2015 (date of notification) must be prepared as per this new format.

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Do you have any grievances related to FCRA ?

Do you have any grievances related to FCRA ? . The answer to this question is YES, then you can now meet Director (FCRA) in Foreigners Division of Ministry of Home Affairs. FCRA department has issued a circular recently stating monthly meeting by Director (FCRA) on 5th of every month for redress of organization’s grievances related to Registration / Prior Permission etc.. (Download Circular from here)

How to meet ?

Organization having any grievances related to FCRA have to take prior appointment.

How to take appointment ?

Email your grievances to ravinder.prasad56@nic.in

Details to be email

Following details to be mentioned in the email stating for appointment :

  1. Name and Address of the association
  2. Name of the person desirous to attend the meeting
  3. Application Number
  4. Issue of Discussion

When and where ?

Room No 104/1, 1st Floor, NDCC-II Building, Ministry of Home Affairs, Jai Sing Road, New Delhi – 110001 on 5th of every month (or on the following working day if 5th happens to be holiday) between 10 a.m. to 1 p.m. on appointment basis.

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Amendments in FCRA Rule 2015 (draft)

After a circular regarding DSC of chief functionary, FCRA Department has issued a circular on 17th June 2015, (Download from here)asking for suggestion on amendments to Foreign Contribution Regulation Rules, 2011 by Foreign Contribution Regulation Rules (2015).

THIS IS A DRAFT AMENDMENTS and suggestions or comments asked from public and other stakeholders on or before 1st July, 2015.

We are in the process of analyzing and studying all the changes in the amendments and it impacts. Meanwhile let us see important changes which are suggested in the amendments of FC Rules :

Website will become mandatory

After this amendments, every NGOs with FC registration will have to build a website. No, it is not declared directly as mandatory. But changes made to Rule 13(1) stating that every registered organization has to publish audited Income Expenditure, Receipt Payments and Balance Sheet of Foreign contribution to its website before 31st December of every year. Such website has to be declared as official website and is to be informed to FCRA department.

Have to publish Foreign Receipt within 7 days

Yes, you have to publish to your official website, every foreign receipts within seven days of receipts. Refer rule 13(B) of such draft amendments.

Bank will have to report in 48 hours

Bank will have to report of FCRA department within 48 hours of any transactions in respect of receipt and utilization of any foreign contribution. Refer rule 16 (2) of such draft amendments.

Online Procedures

We have already write a blog stating how FCRA department is eager to implement all the online procedure. Here in this amendments it is clearly mention that now onwards all the forms will be filled online through DSC and also you can make payment through online payment gateway.

Change in Forms

All the form numbers will be changed e.g. Annual Return Form FC-6 now become FC-4. Not only form numbers, but details and information given in the forms will also changed. We will soon post a blog showing what changes will be made in Forms.

You can give Suggestions

FCRA department has asked for suggestions on the above mentioned amendments from public. You can give your suggestions by email to Mr. A.K. Dhyani, Under Secretary to the Government of India on ak.dhyani@nic.in.

Alternatively you can give your suggestion in the comment box below. We will compile all the suggestions and email to the authority.

Note – This amendments are draft and not final. This will be implemented only after FCRA Rule, 2015 published in the Official Gazzette.

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LAST DATE FOR FILLING FC-6

Those NGO who is registered under FCRA act has to file annual return in Form FC-6 latest before 31/12/2014 for the year 2011-12.

Before submitting  FC-6 online return, one must check carefully, read our this blog on what should be check before filling FC-6 return

Annual Return Under FCRA Act

Last Date = 31st December 2014

Form = FC-6

Year = Financial Year 2013-14

Filling = ONLINE through Home Ministry Website

For More Details – See our calendar here

 

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How to do renewal of FCRA registration of NGOs?

As we all aware about new provisions in Foreign Contribution Act, 2010, all NGOs have to renew its registration in every 5 years. Let us check in detail what is the Renewal Procedure and when and how to file renewal form.

When  FCRA registration expires ?

Existing organization having registration before 1st May 2011, their registration will be expire on 30/04/2016. Organization registered after 1st May 2011, 5 years from the date of the registration.

When  to apply for Renewal of FCRA registration ?

If you have multi-year on going projects – 12 months before expiry date as mentioned above. For existing organization, that cut off date is 30/04/2015.

If you do not have multi-year on going projects – 6 months before expiry date as mentioned above. For existing organization, that cut off date is 30/10/2015.

How to  to apply for Renewal of FCRA registration ?

Application has to be made in Form FC-5. You can download this form in word format from here. Currently FC-5 form is not available to file online like FC-6, so we presume that we have to file this form offline in hard copy.

Form FC5

Form FC5

How Much fees for Renewal of FCRA registration ?

Along with Form FC-5 , organization has to pay Rs. 500 by way of DD or banker’s cheque in the name of “Pay and Account Office, Ministry of Home Affairs” payable at New Delhi.

Time Limit for Renewal of FCRA registration

FCRA department has to renew the certificate, ordinarily within 90 days from the Form FC5 received. If renewal is not granted within time line, it shall communicate reasons for rejection to the organizations.

Consequences for Delay or Not apply for Renewal

In case an organization fails to apply with in cut off dates mentioned above or not apply at all, its registration of FCRA becomes invalid.

Video

Check out this video

 

Conclusion

It is advisable for organization to start preparing for Form FC5. Download Form FC5 in word format from here. In next blog, we will discuss in detail about what information is to be filled in Form FC5.

# Disclaimer
This video is prepared in the view to facilitate users to fill FC 5 form for FCRA renewal. Kindly refer FCR Act and Rules for accurate information. While we have made every attempt to ensure that the information contained in this site has been obtained from reliable sources, KCJMNGO is not responsible for any errors or omissions, or for the results obtained from the use of this information.
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Expenditure of more than Rs. 20000 in Cash

FCRA advisory committee has issued a circular for all the NGOs having registration of FCRA  to spent expenditure of more than Rs. 20000 only by way of CHEQUE or DEMAND DRAFT. This means any CASH Expenditure for more than Rs. 20000 is not advisable as per this circular. The circular issued by FCRA department is attached here.

Let us get into the details.

Why such circular ?

FCRA department has mentioned in the circular that, they have observe many organizations has spend or withdraw huge cash from FCRA Bank and Utilization account.

Is there any provision in FCR Act 2010 ?

As such there is no specific section in the FCR Act, 2010 for limiting expenditure in cash. FCRA Department has given reference of  Sec 40a(3) of Income Tax Act for dis-allowance of expenditure of more than Rs. 20000. However in my opinion that section is applicable to only business income and not grants.

Consequences if spent expenditure for more than Rs. 20000

FCRA department has made it clear in circular that in case of payments expenditure  of more than Rs. 20000 by CASH, such associations are likely to require more intensive scrutiny by Government

What NGO has to do?

Try to make all the payments and expenditure of more than Rs. 20000 by crossed payee cheques or demand draft.

However, in practicality, sometimes NGO has to pay by CASH. In such circumstances there must be valid reason for that and NGO has to keep record for such explanation. So that in case of scrutiny, NGO can put its valid reasons before authorities. (It is author’s personal view)

For any further inquiry click here.

FCRA Department Circular

FCRA Cicrular_Rs20000

 

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