{"id":45275,"date":"2022-07-12T15:40:26","date_gmt":"2022-07-12T10:10:26","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=45275"},"modified":"2025-01-20T18:36:41","modified_gmt":"2025-01-20T13:06:41","slug":"different-reasons-for-cancellation-of-fcra-registration-in-india","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/different-reasons-for-cancellation-of-fcra-registration-in-india\/","title":{"rendered":"Different Reasons for Cancellation of FCRA Registration in India"},"content":{"rendered":"\n<p>Under FCRA Act, 2010, any person can receive a foreign contribution subject to having a definite economic, religious, cultural, religious or social programme and it must obtain the <a href=\"https:\/\/corpbiz.io\/fcra-registration\" title=\"FCRA Registration\"><strong>FCRA Registration<\/strong><\/a>. However, the Ministry of Home Affairs or MHA recently cancelled many FCRA Registration under the FCRA Act, 2010. In this write-up, we will discuss different reasons for the cancellation of FCRA Registration in India.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/different-reasons-for-cancellation-of-fcra-registration-in-india\/#Purpose_of_FCRA_Act_2010\" >Purpose of FCRA Act, 2010<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/different-reasons-for-cancellation-of-fcra-registration-in-india\/#Reasons_for_Cancellation_of_FCRA_Registration_in_India\" >Reasons for Cancellation of\nFCRA Registration in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/different-reasons-for-cancellation-of-fcra-registration-in-india\/#What_Happen_with_the_Cancellation_of_FCRA_Registration\" >What Happen with the\nCancellation of FCRA Registration?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/different-reasons-for-cancellation-of-fcra-registration-in-india\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Purpose_of_FCRA_Act_2010\"><\/span>Purpose of FCRA Act, 2010<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The\nParliament has enacted this Act to consolidate the law to regulate the\nacceptance &amp; utilisation of foreign contribution or foreign hospitality by\ncertain associations or companies or individuals and to prohibit acceptance\n&amp; utilisation of foreign hospitality or foreign contribution for any\nactivities detrimental to national interest &amp; for matters connected\ntherewith or incidental thereto.<\/p>\n\n\n\n<p>A person under <strong>FCRA Act, 2010<\/strong><sup><a href=\"https:\/\/www.incometaxindia.gov.in\/pages\/acts\/foreign-contribution-act.aspx\"><strong>[1]<\/strong><\/a><\/sup> can obtain foreign contributions subject to having an economic, education, social, cultural, or religious purpose. In terms of FCRA, 2010, a person includes:<\/p>\n\n\n\n<ul>\n<li>An association;<\/li>\n\n\n\n<li>A HUF (Hindu Undivided Family);<\/li>\n\n\n\n<li>An individual;<\/li>\n\n\n\n<li>A Company incorporated under Section 25 of the\nCompanies Act, 1956 (now Section 8 of the Companies Act, 2013).<\/li>\n<\/ul>\n\n\n\n<p><strong><em>The\nfollowing are prohibited from receiving foreign contributions:<\/em><\/strong><\/p>\n\n\n\n<ul>\n<li>Candidate for election;<\/li>\n\n\n\n<li>Member of any Legislature;<\/li>\n\n\n\n<li>The organisation of a political nature;<\/li>\n\n\n\n<li>Associations of individuals who have been\nprohibited from receiving Foreign contributions;<\/li>\n\n\n\n<li>Government servant, public servant, judge, or\nemployee of any corporation or any other body controlled or owned by the\nGovernment;<\/li>\n\n\n\n<li>A political party or Office Bearer thereof;<\/li>\n\n\n\n<li>Company or Association involved in the production\nor broadcast of audio news or audio-visual news or current affairs programmes\nvia any digital mode or any other digital form as prescribed under <strong>Clause (r) of sub-section (1) (Section 2)\nof the IT Act,<\/strong> <strong>2000<\/strong> or any other\nmode of mass communication;<\/li>\n\n\n\n<li>Columnist, editor, printer, correspondent,\ncartoonist, or publisher of a registered newspaper.<\/li>\n<\/ul>\n\n\n\n<p>From the above discussion, it is clear that it is compulsory to have FCRA Registration for a specified person to take Foreign Fund &amp; please note that FCRA Registration is valid for a period of 5 years thereafter, it is needed to be renewed before six months of the expiry date. <\/p>\n\n\n\n<p>From the reports, around 20,673 Registration has been cancelled, which means approx. 50% Registration has been cancelled over the Registration granted. Now, we are going to discuss various reasons behind the cancellation of FCRA Registration in India.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Reasons_for_Cancellation_of_FCRA_Registration_in_India\"><\/span>Reasons for Cancellation of\nFCRA Registration in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>If the\nMinistry of Home Affairs observed that mandatorily compliances have not been\nfollowed, it shall make an order to cancel FCRA Registration. Following are the\nreasons that can lead to the cancellation of FCRA Registration.<\/p>\n\n\n\n<ul>\n<li><strong>Non-Filing of Annual Returns<\/strong>: Every Registration FCRA Association or Company is required to file an Annual Return in FC-4 within stipulated period &amp; not filing of annual return is a violation of Section 18 of the Act with Rule 17 of the Foreign Contribution (Regulation) Rules, 2011 and hence in the exercise of the power given by Section 14 of the FCRA Act, the Central Government can give the order for the Cancellation of FCRA Registration of Registered Associations.<\/li>\n<\/ul>\n\n\n\n<p><strong>Note<\/strong>: Once FCRA Registration has been\ncancelled, shall not be eligible for registration\/grant of prior permission for\na period of 3 years from the date of cancellation of FCRA Registration.<\/p>\n\n\n\n<ul>\n<li><strong>Not maintaining proper FCRA Account<\/strong>: As per Section 17 of the FCRA Act, it is compulsory to open a bank account in one or more banks that have integrated their system with PFMS (Public Financial Management System). If it has been noticed by the Central Government that Registered Association or Company hasn&#8217;t complied with the stated requirement, then they can issue an order against the Association for Cancellation of FCRA Registration Certificate.<\/li>\n\n\n\n<li><strong>Making of False Declaration, Statement, or Delivering False Accounts<\/strong>: If NGO or Association or Society intentionally gives false intimation or statements under Clause (c) of Section 9\/Section 18 or seeks prior permission\/Registration by means of false representation\/concealment of material fact, then that can also lead to cancellation of FCRA Registration Certificate. <\/li>\n\n\n\n<li><strong>Not Working in Public Interest<\/strong>: Registered FCRA Association must work for the public interest. A religious, economic, social, cultural, or education programme is defined object to taking FCRA Registration from the Central Government and said object should be in the public interest. Hence, not working in the public interest can lead to the cancellation of FCRA Registration &amp; other penal provision also applicable.<\/li>\n\n\n\n<li><strong>The utilisation of Foreign Contribution for Administrative Purpose<\/strong>: The primary object of raising funds from foreign by the registered Association is to fulfil the core area of the NGO, which should be related to a religious, educational, cultural, or social programme. Avoid more than 50% of foreign contribution received in a particular year to administrative expenses, as this can become a reason for the cancellation of the FCRA Registration Certificate.<\/li>\n\n\n\n<li><strong>Acceptation of Foreign Contribution in Undisclosed Bank Account<\/strong>: Foreign Contribution should be received in Foreign Contribution designated account only &amp; Registered Association shouldn&#8217;t have more than one foreign designated account. Further, hiding of source, amount &amp; manner in which Foreign Remittance or Contribution was received can lead to the cancellation of Registration.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_Happen_with_the_Cancellation_of_FCRA_Registration\"><\/span>What Happen with the\nCancellation of FCRA Registration?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Cancellation of FCRA Registration means that the NGO will no longer be able to receive foreign funds from donors as the FCRA is compulsory for NGOs &amp; associations to get foreign funds. The one whose Registration Certificate has been revoked is not eligible to register for a Certificate\/receive a grant of prior permission for 3 years from the date of the cancellation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>It is vital for companies or associations receiving foreign funds to register under FCRA and obtain FCRA Registration Certificate. But, the entities need to follow all the compliances to avoid the cancellation of FCRA Registration. Furthermore, the Renewal of the FCRA License before expiry is also very important to extend the validity of the license.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our Article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/process-to-get-fcra-registration-online\/\">What is the process to get FCRA registration?<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Under FCRA Act, 2010, any person can receive a foreign contribution subject to having a definite economic, religious, cultural, religious or social programme and it must obtain the FCRA Registration. However, the Ministry of Home Affairs or MHA recently cancelled many FCRA Registration under the FCRA Act, 2010. In this write-up, we will discuss different [&hellip;]<\/p>\n","protected":false},"author":35,"featured_media":45276,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[267],"tags":[2498],"acf":{"service_id":"13"},"authorName":"Karan Singh","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/processed-1-150x150.jpeg","authorDescription":"A legal writing enthusiast, a wanderer, and a zealous reader. After gaining a lot of knowledge about the diverse legal topics and developing research skills, Karan joined the league of legal content writers to deliver quality-rich blogs.","postViews":6000,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/45275"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/35"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=45275"}],"version-history":[{"count":6,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/45275\/revisions"}],"predecessor-version":[{"id":68431,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/45275\/revisions\/68431"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/45276"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=45275"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=45275"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=45275"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}