FCRA Flashcards
Provisions for emergent medical aid recd. by restricted persons
- Prior approval not needed
- CG should be intimated within a month only if value of aid received exceeds 1 lakh
- Otherwise no intimation needed
- Details - Source, purpose, manner utilised, approximate value in rupees
What is foreign contribution
D- Donation
D- Delivery
T-Transfer
-made by a foreign source directly / indirectly of
- any article (exception - gift- personal use- mkt value in india on dt of gift not more than 1 lakh)
- indian/ foreign currency
- security defined under fema & scra
Deemed foreign contribution (2)
- any other income derived from the foreign contribution or interest thereon
- DDT of any article, currency , foreign security by any person who has received it from a foreign source either directly or through one or more persons
exclusion from foreign contribution (3)
- any fee received
- any consideration in lieu of goods or service in ordinary course of biz.
- any contribution received from agent of such foreign source towards such fee or cost
What foreign contribution is allowed to be received even by a person who is prohibited under section 3
- ordinary course of biz
- SALARY, wages or other remuneration
- remittance in ordinary course of business through official channel , post office or any authorised person in forex under FEMA
- scholarship, stipend or payment
- gift as an indian delegate accepted and retained as per CG rules
- gift from a relative more than 1 lakh
- as an agent of a foreign source in relation to any transaction made by the foreign source with the CG or SG
Define foreign hospitality
Any offer
- NOT BEING A PURELY CASUAL ONE
- made in cash or kind by a foreign source
- to provide cost of travel
- to any foreign country/ territory
- or free :
- boarding
- lodging
- transport
- medical treatment
Persons who have restrictions in taking foreign hospitality
ME JOG M - Members of legislature E- Employees for any corporation/any other body owned or controlled by the govt J - Judges O - Office Bearers of political parties G - Government servants
What is the restriction on accepting foreign hospitality for restricted persons
- CG approval 2 weeks before proposed date of travel
- Application along with copy of invitation by host country
+ administrative clearance from the department of govt. or ministry if the trip is sponsored by them
Exception under which provisions of PMLA can be relaxed
The CG can relax all or any provisions of FCRA or modify or revoke such order
- if it finds necessary or expedient in interest of general public
- for an individual (except - candidate for election)
- organisation ( except - political party)
- association
- person
Restrictions on transfer of foreign contribution from a person who is registered or has prior CG permission to a person who doesnt
Can’t transfer more than 10 % of total value
- Make application to CG
- Declaration annexed:
- amt proposed to be transferred during the FY is less than 10% of tot value of fc received by him during the year
-the tranferor shall not transfer any amount of FC until the CG approves the transfer
-
Restrictions on transfer of foreign contribution from a person who is registered or has prior CG permission to a person who also does
-not required to seek the prior approval of the Central Government for transferring the foreign contribution —-provided that the recipient has not been proceeded against under any of the provisions of the Act.
Responsibility for proper utilisation of the foreign contribution in case of transfer
- Both transferor and transferee
- Transfer shall be reflected in FC-6 submitted by both
Person registered/certificate/permission - restriction on utilisation
- Any foreign contribution OR ANY INCOME ARISING OUT OF IT shall not be used for speculative business
- Can’t use more than 20% of FC recd in a FY for admin without prior approval of CG
- shall be used for the purpose obtained
Amounts not to be counted as administrative expenses:
- Expenditure incurred on salaries or remuneration of personnel engaged in training or for collection or analysis of field data of an association primarily engaged in research or training ;
- Expenses incurred directly in furtherance of the stated objectives of the welfare oriented organisation such as salaries to doctors of hospital, salaries to teachers of school etc
Speculative activities meaning
(i) any activity or investment that has an element of risk of appreciation or depreciation of the original investment, linked to market forces, including investment in mutual funds or in shares;
(ii) participation in any scheme that promises high returns like investment in chits or land or similar assets not directly linked to the declared aims and objectives of the organization or association.
Note: A debt-based secure investment shall not be treated as speculative investment.
