in the year 2010
Contribution (Regulation) Act 2010 (FCRA 2010) was passed
by Rajya Sabha on 19th August 2010 with a view to replace
the Foreign Contribution (Regulation) Act 1976.
Foreign Contribution (Regulation) Act, 2010 has come into
effect from May 1, 2011. The Ministry of Home Affairs has
issued the necessary Gazette Notification vide S.O. 999 (E)
dated the 29th April, 2011 in this regard.
Ministry of Home Affairs has also issued a Gazette Notification
vide G.S.R. 349 (E) dated the 29th April, 2011 notifying
the Foreign Contribution (Regulation) Rules, 2011 made under
section 48 of FCRA, 2010.The FCR Rules, 2011 have come into
force simultaneously with FCRA, 2010 i.e w.e.f 1st May, 2011.
new FCRA, 2010 has a much broader applicability; it is applicable
to individuals, Hindu Undivided Family (HUF), Association
and a section 25 company. In the earlier Act, the term person
was not defined and generally the Act referred to the term ‘Association’.
FCRA is amended to remove some inadequacies and practical
difficulties in administration of the Act.
instance Section 17 of FCRA 2010 provides that multiple bank
accounts can be opened for the purposes of utilization provided
only one bank account is maintained for receiving foreign
contribution. This amendment provides a great relief to all
the NGOs which were struggling under the arbitrary disallowance
of multiple bank accounts under FCRA, 1976. Another relief
is the time limit for processing an application for registration.
In the old FCRA there was no time limit but section 12 of
the FCRA 2010, provides the time limit and applications for
registration have to be processed within 90 days. The FCRA
department shall also provide reasons for rejections.