Non-Government Organisation (NGO) or Non-Profit Organisation (NPO) refers to a non-profit establishment, a group, an organization or entrepreneurship undertaken by the activists, voluntary and social individuals. Non-governmental Organizations (NGOs) play a vital role in shaping society and elevating the weaker sections. Almost all major sectors have thousands of NGOs that operate throughout the country, ranging from health, education, food security, etc. The list of potential sectors is abounding.
The individuals working in the non-profit sector are faced with a constant conquest to stay buoyant in times of scarcity of funds. However, acquiring capital is fairly difficult and they often turn towards Donations, Government-funded campaigns, Charity, CSR, and Foreign Funding via a foreign funding advisor for an Indian NGO. The locally-sourced funds don’t have to pass through serious perusal, whereas foreign funding for Indian NGO’s faces scrutiny; owning to concerns about the source of the capital to the ultimate goal, everything is viewed under the lens.
The Foreign Contribution (Regulation) Act, 2010 regulates the utilization and the reception of FDI in donations for churches, FDI funding for NGO’s, and other similar overseas donations for charitable trust made to the non-government organizations in the country. The objective of foreign funding for churches in Kerala, or rather, foreign donations for churches in India, or any other church funding in India is to ensure that the foreign contribution doesn’t get consumed in any malignant activity. The ministry of home affairs mentions that not all the NGOs are working truthfully towards their specific goal. Some of them are deviating funds just to uphold private profit-making ventures. This is why the Ministry of Home Affairs, Government of India has laid down rules for foreign charity for churches in India. The defined law on foreign donations are:
The term ‘foreign contribution’ used above, essentially means currency, articles whose price exceed INR 25,000. While ‘foreign hospitality’ majorly refers to an offer that is presented from a foreign source incorporating travel, boarding, transportation, lodging, or medical treatment cost. The term ‘Foreign source’ encompasses Foreign citizens, Foreign MNCs, Corporations, government agencies, trusts, trade unions, societies, etc. It also includes in its ambit international agencies that don’t fall under the scope of government-specified and verified agencies, as well as individuals residing outside India.
The Act declares specific NGOs that exhibit a definite cultural, economic, religious, educational, or social programme, only after the NGO acquires permission or certificate of registration as specified under the Act. The eligibility criteria for NGOs and foreign donations for churches are-
The NGOs that don’t fulfill the criteria for registration can seek approval from FCRA to receive funding for a specific amount from specified source for a particular purpose.
In both situations, the applicant is required to file an application in the format prescribed with the Authority and submit relevant documents. Also, it is imperative that a separate bank account is dedicated to the specific purpose of foreign contribution. No other fund must be credited to this dedicated account.
The authority is required to conduct an investigation within a time frame of ninety days from the date of receipt of application. If the investigation comes clean with no issues the Authority grants the registration certificate. Some of the criteria that require fulfillment are:
Every NGO that holds prior approval under the Act is liable to file an annual report. The report must have the details of income, expenditure statement, payment account, receipt, and balance sheet for the financial year of the relevant year. The financial years with no foreign contribution must still be furnished with a ‘NIL’ report.
FCRA holds the authority to cancel the registration certificate of an NGO under the following circumstances:
Prior to passing any order, the concerned person is provided reasonable opportunity to present their piece of mind, it is under principles of natural justice. The Authority holds the right to suspend the registration of the concerned NGO for up to 6 months, in case, the cancellation of registration goes on the pending state. Restrictions are inflicted upon the NGO, during the suspension period. These include prohibition from accepting any foreign contribution. In case of cancellation of its registration, the concerned NGO would lose its eligibility for a period of three years, after the specified period the NGO can reapply for approval and registration under the Act.