The Foreign Contribution
(Regulation) Act, 2010
NO. 42 OF 2010
[26th September, 2010.]
An Act to consolidate the law to regulate the acceptance and utilization of
foreign contribution or foreign hospitality by certain individuals or
associations or companies and to prohibit acceptance and utilisation of foreign
contribution or foreign hospitality for any activities detrimental to the
national interest and for matters connected therewith or incidental thereto. BE
it enacted by Parliament in the Sixty-first Year of the Republic of India as
follows:—
CHAPTER I
Preliminary
1. Short title, extent,
application and commencement. - (1) This Act may be called
the Foreign Contribution (Regulation) Act, 2010.
(2) It extends to the whole of India, and it shall
also apply to—
(a) citizens of India outside
India; and
(b) associate branches or
subsidiaries, outside India, of companies or bodies corporate, registered or incorporated
in India.
(3) It shall come into force on such [date] as the
Central Government may, by notification in the Official Gazette, appoint:
Provided that different dates may be appointed for
different provisions of this Act and any reference in any such provision to the
commencement of this Act shall be construed as a reference to the coming into
force of that provision.
2. Definitions. - (1) In this
Act, unless the context otherwise requires,—
(a) “association” means an
association of individuals, whether incorporated or not, having an office in
India and includes a society, whether registered under the Societies
Registration Act, 1860, or not, and any other organisation, by whatever name
called;
(b) “authorised person in foreign
exchange” means an authorised person referred to in clause (c) of section 2 of
the Foreign Exchange Management Act, 1999;
(c) “bank” means a banking company
as referred to in clause (c) of section 5 of the Banking Regulation Act, 1949;
(d) “candidate for election” means
a person who has been duly nominated as a candidate for election to any
Legislature;
(e) “certificate” means
certificate of registration granted under sub-section (3) of section 12;
(f) “company” shall have the
meaning assigned to it under clause (17) of section 2 of the Income-tax Act,
1961;
(g) “foreign company” means any
company or association or body of individuals incorporated outside India and
includes—
(i) a foreign company within the
meaning of section 591 of the Companies Act, 1956;
(ii) a company which is a
subsidiary of a foreign company;
(iii) the registered office or
principal place of business of a foreign company referred to in sub-clause (i)
or company referred to in sub-clause (ii);
(iv) a multi-national corporation.
Explanation.— For the purposes
of this sub-clause, a corporation incorporated in a foreign country or
territory shall be deemed to be a multi-national corporation if such
corporation,—
(a) has a subsidiary or a branch
or a place of business in two or more countries or territories; or
(b) carries on business, or
otherwise operates, in two or more countries or territories;
(h) “foreign contribution” means
the donation, delivery or transfer made by any foreign source,—
(i) of any article, not being an
article given to a person as a gift for his personal use, if the market value,
in India, of such article, on the date of such gift, is not more than such sum
as may be specified from time to time, by the Central Government by the rules
made by it in this behalf;
(ii) of any currency, whether
Indian or foreign;
(iii) of any security as defined
in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956
and includes any foreign security as defined in clause (o) of section 2 of` the
Foreign Exchange Management Act, 1999.
Explanation 1.— A donation,
delivery or transfer of any article, currency or foreign security referred to
in this clause by any person who has received it from any foreign source,
either directly or through one or more persons, shall also be deemed to be foreign
contribution within the meaning of this clause.
Explanation 2.— The interest
accrued on the foreign contribution deposited in any bank referred to in
sub-section (1) of section 17 or any other income derived from the foreign
contribution or interest thereon shall also be deemed to be foreign
contribution within the meaning of this clause.
Explanation 3.— Any amount
received, by any person from any foreign source in India, by way of fee
(including fees charged by an educational institution in India from foreign
student) or towards cost in lieu of goods or services rendered by such person
in the ordinary course of his business, trade or commerce whether within India
or outside India or any contribution received from an agent of a foreign source
towards such fee or cost shall be excluded from the definition of foreign
contribution within the meaning of this clause;
(i) “foreign hospitality” means
any offer, not being a purely casual one, made in cash or kind by a foreign
source for providing a person with the costs of travel to any foreign country
or territory or with free boarding, lodging, transport or medical treatment;
(j) “foreign source” includes,—
(i) the Government of any foreign
country or territory and any agency of such Government;
(ii) any international agency, not
being the United Nations or any of its specialised agencies, the World Bank,
International Monetary Fund or such other agency as the Central Government may,
by notification, specify in this behalf;
(iii) a foreign company;
(iv) a corporation, not being a
foreign company, incorporated in a foreign country or territory;
(v) a multi-national corporation
referred to in sub-clause (iv) of clause (g);
(vi) a company within the meaning
of the Companies Act, 1956, and more than one-half of the nominal value of its
share capital is held, either singly or in the aggregate, by one or more of the
following, namely:—
(A) the Government of a foreign
country or territory;
(B) the citizens of a foreign
country or territory;
(C) corporations incorporated in a
foreign country or territory;
(D) trusts, societies or other
associations of individuals (whether incorporated or not), formed or registered
in a foreign country or territory;
(E) foreign company;
(vii) a trade union in any foreign
country or territory, whether or not registered in such foreign country or
territory;
(viii) a foreign trust or a
foreign foundation, by whatever name called, or such trust or foundation mainly
financed by a foreign country or territory;
(ix) a society, club or other association
of individuals formed or registered outside India;
(x) a citizen of a foreign
country;
(k) “Legislature” means —
(A) either House of Parliament;
(B) the Legislative Assembly of a
State, or in the case of a State having a Legislative Council, either House of
the Legislature of that State;
(C) Legislative Assembly of a
Union territory constituted under the Government of Union Territories Act,
1963;
(D) Legislative Assembly for the
National Capital Territory of Delhi referred to in the Government of National
Capital Territory of Delhi Act, 1991;
(E) Municipality as defined in
clause (e) of article 243P of the Constitution;
(F) District Councils and Regional
Councils in the States of Assam, Meghalaya, Tripura and Mizoram as provided in
the Sixth Schedule to the Constitution;
(G) Panchayat as defined in clause
(d) of article 243 of the Constitution; or
(H) any other elective body as may
be notified by the Central Government;
(l) “notification” means
notification published in the Official Gazette and the expression “notify”
shall be construed accordingly;
(m) “person” includes—
(i) an individual;
(ii) a Hindu undivided family;
(iii) an association;
(iv) a company registered under
section 25 of the Companies Act, 1956;
(n) “political party” means—
(i) an association or body of
individual citizens of India—
(A) to be registered with the
Election Commission of India as a political party under section 29A of the
Representation of the People Act, 1951; or
(B) which has set up candidates
for election to any Legislature, but is not so registered or deemed to be
registered under the Election Symbols (Reservation and Allotment) Order, 1968;
(ii) a political party mentioned
in column 2 of Table 1 and Table 2 to the notification of the Election
Commission of India No.56/J&K/02, dated the 8th August, 2002, as in force
for the time being;
(o) “prescribed” means prescribed
by rules made under this Act;
(p) “prescribed authority” means
an authority specified as such by rules made by the Central Government under
this Act;
(q) “registered newspaper” means a
newspaper registered under the Press and Registration of Books Act, 1867;
(r) “relative” has the meaning
assigned to it in clause (41) of section 2 of the Companies Act, 1956;
(s) “scheduled bank” shall have
the meaning assigned to it under clause (e) of section 2 of the Reserve Bank of
India Act, 1934;
(t) “subsidiary” and “associate”
shall have the meanings, respectively assigned to them in the Companies Act,
1956;
(u) “trade union” means a trade
union registered under the Trade Unions Act, 1926;
(2) Words and expressions used herein and not
defined in this Act but defined in the Representation of the People Act, 1950
or the Representation of the People Act, 1951 or the Foreign Exchange
Management Act, 1999 shall have the meanings respectively assigned to them in
those Acts.
CHAPTER II
Regulation Of Foreign Contribution And Foreign Hospitality
3. Prohibition to accept
foreign contribution. - (1) No foreign
contribution shall be accepted by any—
(a) candidate for election;
(b) correspondent, columnist,
cartoonist, editor, owner, printer or publisher of a registered newspaper;
(c) Judge, Government servant or
employee of any corporation or any other body controlled or owned by the
Government;
(d) member of any Legislature;
(e) political party or
office-bearer thereof;
(f) organisation of a political
nature as may be specified under sub-section (1) of section 5 by the Central
Government;
(g) association or company engaged
in the production or broadcast of audio news or audio visual news or current
affairs programmes through any electronic mode, or any other electronic form as
defined in clause (r) of sub-section (1) of section 2 of the Information
Technology Act, 2000 or any other mode of mass communication;
(h) correspondent or columnist,
cartoonist, editor, owner of the association or company referred to in clause
(g).
Explanation.—In clause (c)
and section 6, the expression “corporation” means a corporation owned or
controlled by the Government and includes a Government company as defined in
section 617 of the Companies Act, 1956.
(2) (a) No person, resident in India, and no
citizen of India resident outside India, shall accept any foreign contribution,
or acquire or agree to acquire any currency from a foreign source, on behalf of
any political party, or any person referred to in sub-section (1), or both.
(b) No person, resident in India,
shall deliver any currency, whether Indian or foreign, which has been accepted
from any foreign source, to any person if he knows or has reasonable cause to
believe that such other person intends, or is likely, to deliver such currency
to any political party or any person referred to in sub-section (1), or both.
(c) No citizen of India resident outside India shall deliver any currency, whether
Indian or foreign, which has been accepted from any foreign source, to—
(i) any political party or any
person referred to in sub-section (1), or both; or
(ii) any other person, if he knows
or has reasonable cause to believe that such other person intends, or is
likely, to deliver such currency to a political party or to any person referred
to in sub-section (1), or both.
(3) No person receiving any currency, whether
Indian or foreign, from a foreign source on behalf of any person or class of
persons, referred to in section 9, shall deliver such currency—
(a) to any person other than a
person for which it was received, or
(b) to any other person, if he
knows or has reasonable cause to believe that such other person intends, or is
likely, to deliver such currency to a person other than the person for which
such currency was received.
4. Persons to whom section
3 shall not apply. - Nothing contained in section 3 shall apply to the
acceptance, by any person specified in that section, of any foreign contribution
where such contribution is accepted by him, subject to the provisions of
section 10,—
(a) by way of salary, wages or
other remuneration due to him or to any group of persons working under him,
from any foreign source or by way of payment in the ordinary course of business
transacted in India by such foreign source; or
(b) by way of payment, in the
course of international trade or commerce, or in the ordinary course of
business transacted by him outside India; or
(c) as an agent of a foreign
source in relation to any transaction made by such foreign source with the
Central Government or State Government; or
(d) by way of a gift or
presentation made to him as a member of any Indian delegation, provided that
such gift or present was accepted in accordance with the rules made by the
Central Government with regard to the acceptance or retention of such gift or
presentation; or
(e) from his relative; or
(f) by way of remittance received,
in the ordinary course of business through any official channel, post office,
or any authorised person in foreign exchange under the Foreign Exchange
Management Act, 1999; or
(g) by way of any scholarship,
stipend or any payment of like nature:
Provided that in case any foreign contribution
received by any person specified under section 3, for any of the purposes other
than those specified under this section, such contribution shall be deemed to
have been accepted in contravention of the provisions of section 3.
5. Procedure to notify an
organisation of a political nature. - (1) The Central Government
may, having regard to the activities of the organisation or the ideology
propagated by the organisation or the programme of the organisation or the
association of the organisations with the activities of any political party, by
an order published in the Official Gazette, specify such organisation as an
organisation of a political nature not being a political party, referred to in
clause (f) of sub-section (1) of section 3:
Provided that the Central Government may, by rules
made by it, frame the guidelines specifying the ground or grounds on which an
organisation shall be specified as an organisation of a political nature.
(2) Before making an order under sub-section (1),
the Central Government shall give the organisation in respect of whom the order
is proposed to be made, a notice in writing informing it of the ground or
grounds, on which it is proposed to be specified as an organisation of
political nature under that sub-section.
(3) The organisation to whom a notice has been served
under sub-section (2), may, within a period of thirty days from the date of the
notice, make a representation to the Central Government giving reasons for not
specifying such organisation as an organisation under sub-section (1):
Provided that the Central Government may entertain
the representation after the expiry of the said period of thirty days, if it is
satisfied that the organisation was prevented by sufficient cause from making
the representation within thirty days.
(4) The Central Government may, if it considers it
appropriate, forward the representation referred to in sub-section (3) to any
authority to report on such representation.
(5) The Central Government may, after considering
the representation and the report of the authority referred to in sub-section
(4), specify such organisation as an organisation of a political nature not
being a political party and make an order under sub-section (1) accordingly.
(6) Every order under sub-section (1) shall be made
within a period of one hundred and twenty days from the date of issue of notice
under sub-section (2):
Provided that in case no order is made within the
said period of one hundred and twenty days, the Central Government shall, after
recording the reasons therefor, make an order under sub-section (1) within a
period of sixty days from the expiry of the said period of one hundred and
twenty days.
6. Restriction on
acceptance of foreign hospitality. - No member of a Legislature
or office-bearer of a political party or Judge or Government servant or
employee of any corporation or any other body owned or controlled by the
Government shall, while visiting any country or territory outside India,
accept, except with the prior permission of the Central Government, any foreign
hospitality:
Provided that it shall not be necessary to obtain
any such permission for an emergent medical aid needed on account of sudden
illness contracted during a visit outside India, but, where such foreign
hospitality has been received, the person receiving such hospitality shall
give, within one month from the date of receipt of such hospitality an
intimation to the Central Government as to the receipt of such hospitality, and
the source from which, and the manner in which, such hospitality was received
by him.
(a) is registered and granted a
certificate or has obtained prior permission under this Act; and
(b) receives any foreign
contribution, shall transfer such foreign contribution to any other person
unless such other person is also registered and had been granted the
certificate or obtained the prior permission under this Act:
Provided that such person may transfer, with the
prior approval of the Central Government, a part of such foreign contribution
to any other person who has not been granted a certificate or obtained
permission under this Act in accordance with the rules made by the Central
Government.
8. Restriction to utilise
foreign contribution for administrative purpose. - (1) Every
person, who is registered and granted a certificate or given prior permission
under this Act and receives any foreign contribution,—
(a) shall utilise such
contribution for the purposes for which the contribution has been received:
Provided that any foreign contribution or any
income arising out of it shall not be used for speculative business:
Provided further that the Central Government shall,
by rules, specify the activities or business which shall be construed as
speculative business for the purpose of this section;
(b) 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:
Provided that administrative expenses exceeding
fifty per cent. of such contribution may be defrayed with prior approval of the
Central Government.
(2) The Central Government may prescribe the
elements which shall be included in the administrative expenses and the manner
in which the administrative expenses referred to in sub-section (1) shall be
calculated.
9. Power of Central
Government to prohibit receipt of foreign contribution, etc., in certain cases.
- The Central Government may—
(a) prohibit any person or
organisation not specified in section 3, from accepting any foreign
contribution;
(b) require any person or class of
persons, not specified in section 6, to obtain prior permission of the Central
Government before accepting any foreign hospitality;
(c) require any person or class of
persons not specified in section 11, to furnish intimation within such time and
in such manner as may be prescribed as to the amount of any foreign
contribution received by such person or class of persons as the case may be,
and the source from which and the manner in which such contribution was
received and the purpose for which and the manner in which such foreign
contribution was utilised;
(d) without prejudice to the
provisions of sub-section (1) of section 11, require any person or class of
persons specified in that sub-section to obtain prior permission of the Central
Government before accepting any foreign contribution;
(e) require any person or class of
persons, not specified in section 6, to furnish intimation, within such time
and in such manner as may be prescribed, as to the receipt of any foreign
hospitality, the source from which and the manner in which such hospitality was
received:
Provided that no such prohibition or requirement
shall be made unless the Central Government is satisfied that the acceptance of
foreign contribution by such person or class of persons, as the case may be, or
the acceptance of foreign hospitality by such person, is likely to affect
prejudicially —
(i) the sovereignty and integrity
of India; or
(ii) public interest; or
(iii) freedom or fairness of
election to any Legislature; or
(iv) friendly relations with any
foreign State; or
(v) harmony between religious,
racial, social, linguistic or regional groups, castes or communities.
10. Power to prohibit
payment of currency received in contravention of the Act. - Where the
Central Government is satisfied, after making such inquiry as it may deem fit,
that any person has in his custody or control any article or currency or
security, whether Indian or foreign, which has been accepted by such person in
contravention of any of the provisions of this Act, it may, by order in
writing, prohibit such person from paying, delivering, transferring or
otherwise dealing with, in any manner whatsoever, such article or currency or
security save in accordance with the written orders of the Central Government
and a copy of such order shall be served upon the person so prohibited in the
prescribed manner, and thereupon the provisions of sub-sections (2), (3), (4)
and (5) of section 7 of the Unlawful Activities (Prevention) Act, 1967 shall,
so far as may be, apply to, or in relation to, such article or currency or
security and references in the said subsections to moneys, securities or
credits shall be construed as references to such article or currency or
security.
CHAPTER III
Registration
11. Registration of
certain persons with Central Government. - (1) Save as
otherwise provided in this Act, no person having a definite cultural, economic,
educational, religious or social programme shall accept foreign contribution
unless such person obtains a certificate of registration from the Central
Government:
Provided that any association registered with the
Central Government under section 6 or granted prior permission under that
section of the Foreign Contribution (Regulation) Act, 1976, as it stood
immediately before the commencement of this Act, shall be deemed to have been
registered or granted prior permission, as the case may be, under this Act and
such registration shall be valid for a period of five years from the date on
which this section comes into force.
(2) Every person referred to in sub-section (1)
may, if it is not registered with the Central Government under that
sub-section, accept any foreign contribution only after obtaining the prior
permission of the Central Government and such prior permission shall be valid
for the specific purpose for which it is obtained and from the specific source:
Provided that if the person referred to in
sub-sections (1) and (2) has been found guilty of violation of any of the
provisions of this Act or the Foreign Contribution (Regulation) Act, 1976, the
unutilised or unreceived amount of foreign contribution shall not be utilised
or received, as the case may be, without the prior approval of the Central
Government.
(3) Notwithstanding anything contained in this Act,
the Central Government may, by notification in the Official Gazette, specify—
(i) the person or class of persons
who shall obtain its prior permission before accepting the foreign
contribution; or
(ii) the area or areas in which the
foreign contribution shall be accepted and utilised with the prior permission
of the Central Government; or
(iii) the purpose or purposes for
which the foreign contribution shall be utilised with the prior permission of
the Central Government; or
(iv) the source or sources from
which the foreign contribution shall be accepted with the prior permission of
the Central Government.
12. Grant of certificate
of registration. - (1) An application by a person, referred to in
section 11 for grant of certificate or giving prior permission, shall be made
to the Central Government in such form and manner and along with such fee, as
may be prescribed.
(2) On receipt of an application under sub-section
(1), the Central Government shall, by an order, if the application is not in
the prescribed form or does not contain any of the particulars specified in
that form, reject the application.
(3) If on receipt of an application for grant of
certificate or giving prior permission and after making such inquiry as the
Central Government deems fit, it is of the opinion that the conditions
specified in sub-section (4) are satisfied, it may, ordinarily within ninety
days from the date of receipt of application under sub-section (1), register
such person and grant him a certificate or give him prior permission, as the
case may be, subject to such terms and conditions as may be prescribed:
Provided that in case the Central Government does
not grant, within the said period of ninety days, a certificate or give prior
permission, it shall communicate the reasons therefor to the applicant:
Provided further that a person shall not be
eligible for grant of certificate or giving prior permission, if his
certificate has been suspended and such suspension of certificate continues on
the date of making application.
(4) The following shall be the conditions for the
purposes of sub-section (3), namely:—
(a) the person making an
application for registration or grant of prior permission under sub-section
(1),—
(i) is not fictitious or benami;
(ii) has not been prosecuted or
convicted for indulging in activities aimed at conversion through inducement or
force, either directly or indirectly, from one religious faith to another;
(iii) has not been prosecuted or
convicted for creating communal tension or disharmony in any specified district
or any other part of the country;
(iv) has not been found guilty of
diversion or mis-utilisation of its funds;
(v) is not engaged or likely to
engage in propagation of sedition or advocate violent methods to achieve its ends;
(vi) is not likely to use the
foreign contribution for personal gains or divert it for undesirable purposes;
(vii) has not contravened any of
the provisions of this Act;
(viii) has not been prohibited
from accepting foreign contribution;
(b) the person making an
application for registration under sub-section (1) has undertaken reasonable
activity in its chosen filed for the benefit of the society for which the
foreign contribution is proposed to be utilised;
(c) the person making an
application for giving prior permission under sub-section (1) has prepared a
reasonable project for the benefit of the society for which the foreign
contribution is proposed to be utilised;
(d) in case the person being an
individual, such individual has neither been convicted under any law for the
time being in force nor any prosecution for any offence pending against him;
(e) in case the person being other
than an individual, any of its directors or office bearers has neither been
convicted under any law for the time being in force nor any prosecution for any
offence is pending against him;
(f) the acceptance of foreign
contribution by the person referred to in subsection (1) is not likely to
affect prejudicially—
(i) the sovereignty and integrity
of India; or
(ii) the security, strategic,
scientific or economic interest of the State; or
(iii) the public interest; or
(iv) freedom or fairness of
election to any Legislature; or
(v) friendly relation with any
foreign State; or
(vi) harmony between religious,
racial, social, linguistic, regional groups, castes or communities;
(g) the acceptance of foreign
contribution referred to in sub-section (1),—
(i) shall not lead to incitement
of an offence;
(ii) shall not endanger the life
or physical safety of any person.
(5) Where the Central Government refuses the grant
of certificate or does not give prior permission, it shall record in its order
the reasons therefor and furnish a copy thereof to the applicant:
Provided that the Central Government may not
communicate the reasons for refusal for grant of certificate or for not giving
prior permission to the applicant under this section in cases where is no
obligation to give any information or documents or records or papers under the
Right to Information Act, 2005.
(6) The certificate granted under sub-section (3)
shall be valid for a period of five years and the prior permission shall be
valid for the specific purpose or specific amount of foreign contribution
proposed to be received, as the case may be.
13. Suspension of
certificate. - (1) Where the Central Government, for reasons to be
recorded in writing, is satisfied that pending consideration of the question of
cancelling the certificate on any of the grounds mentioned in sub-section (1)
of section 14, it is necessary so to do, it may, by order in writing, suspend
the certificate for such period not exceeding one hundred and eighty days as
may be specified in the order.
(2) Every person whose certificate has been
suspended shall —
(a) not receive any foreign
contribution during the period of suspension of certificate:
Provided that the Central Government, on an
application made by such person, if it considers appropriate, allow receipt of
any foreign contribution by such person on such terms and conditions as it may
specify;
(b) utilise, in the prescribed
manner, the foreign contribution in his custody with the prior approval of the
Central Government .
14. Cancellation of
certificate. - (1) The Central Government may, if it is satisfied
after making such inquiry as it may deem fit, by an order, cancel the
certificate if —
(a) the holder of the certificate
has made a statement in, or in relation to, the application for the grant of
registration or renewal thereof, which is incorrect or false; or
(b) the holder of the certificate
has violated any of the terms and conditions of the certificate or renewal
thereof; or
(c) in the opinion of the Central
Government, it is necessary in the public interest to cancel the certificate;
or
(d) the holder of certificate has
violated any of the provisions of this Act or rules or order made thereunder;
or
(e) if the holder of the
certificate has not been engaged in any reasonable activity in its chosen field
for the benefit of the society for two consecutive years or has become defunct.
(2) No order of cancellation of certificate under
this section shall be made unless the person concerned has been given a
reasonable opportunity of being heard.
(3) Any person whose certificate has been cancelled
under this section shall not be eligible for registration or grant of prior
permission for a period of three years from the date of cancellation of such
certificate.
15. Management of foreign
contribution of person whose certificate has been cancelled. - (1) The foreign
contribution and assets created out of the foreign contribution in the custody
of every person whose certificate has been cancelled under section 14 shall
vest in such authority as may be prescribed.
(2) The authority referred to in sub-section (1)
may, if it considers necessary and in public interest, manage the activities of
the person referred to in that sub-section for such period and in such manner,
as the Central Government may direct and such authority may utilise the foreign
contribution or dispose of the assets created out of it in case adequate funds
are not available for running such activity.
(3) The authority referred to in sub-section (1)
shall return the foreign contribution and the assets vested upon it under that
sub-section to the person referred to in the said subsection if such person is
subsequently registered under this Act.
16. Renewal of
certificate. - (1) Every person who has been granted a certificate
under section 12 shall have such certificate renewed within six months before
the expiry of the period of the certificate.
(2) The application for renewal of the certificate
shall be made to the Central Government in such form and manner and accompanied
by such fee as may be prescribed.
(3) The Central Government shall renew the
certificate, ordinarily within ninety days from the date of receipt of
application for renewal of certificate subject to such terms and conditions as
it may deem fit and grant a certificate of renewal for a period of five years:
Provided that in case the Central Government does
not renew the certificate within the said period of ninety days, it shall
communicate the reasons therefor to the applicant:
Provided further that the Central Government may
refuse to renew the certificate in case where a person has violated any of the
provisions of this Act or rules made thereunder.
CHAPTER IV
Accounts, Intimation, Audit And Disposal Of Assets, Etc.
17. Foreign contribution
through scheduled bank. - (1) Every person who has
been granted a certificate or given prior permission under section 12 shall
receive foreign contribution in a single account only through such one of the
branches of a bank as he may specify in his application for grant of
certificate:
Provided that such person may open one or more
accounts in one or more banks for utilising the foreign contribution received
by him:
Provided further that no funds other than foreign
contribution shall be received or deposited in such account or accounts.
(2) Every bank or authorised person in foreign
exchange shall report to such authority as may be specified—
(a) prescribed amount of foreign
remittance;
(b) the source and manner in which
the foreign remittance was received; and
(c) other particulars, in such
form and manner as may be prescribed.
18. Intimation. - (1) Every
person who has been granted a certificate or given prior approval under this
Act shall give, within such time and in such manner as may be prescribed, an
intimation to the Central Government, and such other authority as may be
specified by the Central Government, as to the amount of each foreign contribution
received by it, the source from which and the manner in which such foreign
contribution was received, and the purposes for which, and the manner in which
such foreign contribution was utilised by him.
(2) Every person receiving foreign contribution
shall submit a copy of a statement indicating therein the particulars of
foreign contribution received duly certified by officer of the bank or
authorised person in foreign exchange and furnish the same to the Central
Government along with the intimation under sub-section (1).
19. Maintenance of
accounts. - Every person who has been granted a certificate or
given prior approval under this Act shall maintain, in such form and manner as
may be prescribed,—
(a) an account of any foreign
contribution received by him; and
(b) a record as to the manner in
which such contribution has been utilised by him.
20. Audit of accounts.
- Where any person who has been granted a certificate or given prior
permission, fails to furnish any intimation under this Act within the time
specified therefor or the intimation so furnished is not in accordance with law
or if, after inspection of such intimation, the Central Government has any
reasonable cause to believe that any provision of this Act has been, or is
being, contravened, the Central Government may, by general or special order,
authorise such gazetted officer, holding a Group A post under the Central
Government or any other officer or authority or organisation, as it may think
fit, to audit any books of account kept or maintained by such person and
thereupon every such officer shall have the right to enter in or upon any
premises at any reasonable hour, before sunset and after sunrise, for the
purpose of auditing the said books of account:
Provided that any information obtained from such
audit shall be kept confidential and shall not be disclosed except for the
purposes of this Act.
21. Intimation by
candidate for election. - Every candidate for
election, who had received any foreign contribution, at any time within one hundred
and eighty days immediately preceding the date on which he is duly nominated as
such candidate, shall give, within such time and in such manner as may be
prescribed, an intimation to the Central Government or prescribed authority or
both as to the amount of foreign contribution received by him, the source from
which, and the manner in which, such foreign contribution was received and the
purposes for which and the manner in which such foreign contribution was
utilised by him.
22. Disposal of assets created
out of foreign contribution. - Where any person who was
permitted to accept foreign contribution under this Act, ceases to exist or has
become defunct, all the assets of such person shall be disposed of in
accordance with the provisions contained in any law for the time being in force
under which the person was registered or incorporated, and in the absence of
any such law, the Central Government may, having regard to the nature of assets
created out of foreign contribution received under this Act, by notification,
specify that all such assets shall be disposed off by such authority, as it may
specify, in such manner and procedure as may be prescribed.
CHAPTER V
Inspection, Search And Seizure
23. Inspection of accounts
or records. - If the Central Government has, for any reason, to
be recorded in writing, any ground to suspect that any provision of this Act
has been or is being, contravened by—
(a) any political party; or
(b) any person; or
(c) any organisation; or
(d) any association, it may, by general
or special order, authorise such gazetted officer, holding a Group A post under
the Central Government or such other officer or authority or organisation, as
it may think fit (hereinafter referred to as the inspecting officer), to
inspect any account or record maintained by such political party, person,
organisation or association, as the case may be, and thereupon every such
inspecting officer shall have the right to enter in or upon any premises at any
reasonable hour, before sunset and after sunrise, for the purpose of inspecting
the said account or record.
24. Seizure of accounts or
records. - If, after inspection of an account or record
referred to in section 23, the inspecting officer has any reasonable cause to
believe that any provision of this Act or of any other law relating to foreign
exchange has been, or is being, contravened, he may seize such account or
record and produce the same before the court, authority or tribunal in which
any proceeding is brought for such contravention:
Provided that the authorised officer shall return
such account or record to the person from whom it was seized if no proceeding
is brought within six months from the date of such seizure for the
contravention disclosed by such account or record.
25. Seizure of article or
currency or security received in contravention of the Act. - If any gazetted
officer, authorised in this behalf by the Central Government by general or
special order, has any reason to believe that any person has in his possession
or control any article exceeding the value specified in sub-clause (i) of
clause (h) of sub-section (1) of section 2 or currency or security whether
Indian or foreign, in relation to which any provision of this Act has been or
is being, contravened, he may seize such article or currency or security.
26. Disposal of seized
article or currency or security. - (1) The Central
Government, may, having regard to the value of article or currency or security,
their vulnerability to theft or any relevant consideration, by notification,
specify such article or currency or security which shall, as soon as may be
after their seizure, be disposed of by such officer and in such manner, as the
Central Government may, from time to time, determine after following the
procedure hereinafter specified.
(2) The article or currency or security seized
shall be forwarded without unnecessary delay to such officer as may be
specified.
(3) Where any article or currency or security has
been seized and forwarded to such officer, the officer referred to in sub-section
(1), shall prepare an inventory of such article or currency or security
containing such details relating to their description, value or such other
identifying particulars as the officer referred to in that sub-section may
consider relevant to the identity of the article or the currency or security
and make an application to any Magistrate for the purposes of certifying the
correctness of the inventory so prepared.
(4) Where an application is made under sub-section
(2), the Magistrate shall, as soon as may be, allow the application.
(5) Notwithstanding anything contained in the
Indian Evidence Act, 1872 or the Code of Criminal Procedure, 1973, every court
trying an offence under this Act, shall treat the inventory, as certified by
the Magistrate, as primary evidence in respect of such offence.
(6) Every officer acting under sub-section (3)
shall forthwith report the seizure to the Court of Session or Assistant
Sessions Judge having jurisdiction for adjudging the confiscation under section
29.
27. Seizure to be made in
accordance with Act 2 of 1974. - The provisions of the Code
of Criminal Procedure, 1973 shall apply in so far as they are not inconsistent
with the provisions of this Act to all seizures made under this Act.
CHAPTER VI
Adjudication
28. Confiscation of
article or currency or security obtained in contravention of the Act. - Any article or
currency or security which is seized under section 25 shall be liable to
confiscation if such article or currency or security has been adjudged under section
29 to have been received or obtained in contravention of this Act.
(a) without limit, by the Court of
Session within the local limits of whose jurisdiction the seizure was made; and
(b) subject to such limits as may
be prescribed, by such officer, not below the rank of an Assistant Sessions
Judge, as the Central Government may, by notification in the Official Gazette,
specify in this behalf.
(2) When an adjudication under sub-section (1) is
concluded by the Court of Session or Assistant Sessions Judge, as the case may
be, the Sessions Judge or Assistant Sessions Judge may make such order as he
thinks fit for the disposal by confiscation or delivery of seized article or
currency or security, as the case may be, to any person claiming to be entitled
to possession thereof or otherwise, or which has been used for the commission
of any offence under this Act.
30. Procedure for
confiscation. - No order of adjudication of confiscation shall be
made unless a reasonable opportunity of making a representation against such
confiscation has been given to the person from whom any article or currency or
security has been seized.
CHAPTER VII
Appeal And Revision
(a) where the order has been made
by the Court of Session, to the High Court to which such Court is subordinate;
or
(b) where the order has been made
by any officer specified under clause (b) of sub-section (1) of section 29, to
the Court of Session within the local limits of whose jurisdiction such order
of adjudication of confiscation was made, within one month from the date of
communication to such person of the order:
Provided that the appellate court may, if it is
satisfied that the appellant was prevented by sufficient cause from preferring
the appeal within the said period of one month, allow such appeal to be
preferred within a further period of one month, but not thereafter.
(2) Any organisation referred to in clause (f) of
sub-section (1) of section 3, or any person or association referred to in
section 6 or section 9, aggrieved by an order made in pursuance of section 5 or
by an order of the Central Government refusing to give permission under this
Act, or by any order made by the Central Government under subsection (2) or
sub-section (4) of section 12, or sub-section (1) of section 14, as the case
may be, may, within sixty days from the date of such order, prefer an appeal
against such order to the High Court within the local limits of whose
jurisdiction the appellant ordinarily resides or carries on business or
personally works for gain, or, where the appellant is an organisation or
association, the principal office of such organisation or association is
located.
(3) Every appeal preferred under this section shall
be deemed to be an appeal from an original decree and the provisions of Order
XLI of the First Schedule to the Code of Civil Procedure, 1908, shall, as far
as may be, apply thereto as they apply to an appeal from an original decree.
32. Revision of orders by
Central Government. - (1) The Central Government may, either of its own
motion or on an application for revision by the person registered under this
Act, call for and examine the record of any proceeding under this Act in which
any such order has been passed by it and may make such inquiry or cause such
inquiry to be made and, subject to the provisions of this Act, may pass such
order thereon as it thinks fit.
(2) The Central Government shall not of its own
motion revise any order under this section if the order has been made more than
one year previously.
(3) In the case of an application for revision
under this section by the person referred to in sub-section (1), the
application must be made within one year from the date on which the order in
question was communicated to him or the date on which he otherwise came to know
of it, whichever is earlier:
Provided that the Central Government may, if it is
satisfied that such person was prevented by sufficient cause from making the
application within that period, admit an application made after the expiry of
that period.
(4) The Central Government shall not revise any
order where an appeal against the order lies but has not been made and the time
within which such appeal may be made has not expired or such person has not
waived his right of appeal or an appeal has been filed under this Act.
(5) Every application by such person for revision
under this section shall be accompanied by such fee, as may be prescribed.
Explanation.— An order by the Central Government
declining to interfere shall, for the purposes of this section, be deemed not
to be an order prejudicial to such person.
CHAPTER VIII
Offences And Penalties
33. Making of false
statement, declaration or delivering false accounts. - Any person,
subject to this Act, who knowingly, —
(a) gives false intimation under
sub-section (c) of section 9 or section 18; or
(b) seeks prior permission or registration
by means of fraud, false representation or concealment of material fact, shall,
on conviction by a court, be liable to imprisonment for a term which may extend
to six months or with fine or with both.
34. Penalty for article or
currency or security obtained in contravention of section 10. - If any person,
on whom any prohibitory order has been served under section 10, pays, delivers,
transfers or otherwise deals with, in any manner whatsoever, any article or
currency or security, whether Indian or foreign, in contravention of such
prohibitory order, he shall be punished with imprisonment for a term which may
extend to three years, or with fine, or with both; and notwithstanding anything
contained in the Code of Criminal Procedure, 1973, the court trying such
contravention may also impose on the person convicted an additional fine
equivalent to the market value of the article or the amount of the currency or
security in respect of which the prohibitory order has been contravened by him
or such part thereof as the court may deem fit.
35. Punishment for
contravention of any provision of the Act. - Whoever
accepts, or assists any person, political party or organisation in accepting,
any foreign contribution or any currency or security from a foreign source, in
contravention of any provision of this Act or any rule or order made
thereunder, shall be punished with imprisonment for a term which may extend to
five years, or with fine, or with both.
36. Power to impose
additional fine where article or currency or security is not available for
confiscation. - Notwithstanding anything contained in the Code of
Criminal Procedure, 1973, the court trying a person, who, in relation to any
article or currency or security, whether Indian or foreign, does or omits to do
any act which act or omission would render such article or currency or security
liable to confiscation under this Act, may, in the event of the conviction of
such person for the act or omission aforesaid, impose on such person a fine not
exceeding five times the value of the article or currency or security or one
thousand rupees, whichever is more, if such article or currency or security is
not available for confiscation, and the fine so imposed shall be in addition to
any other fine which may be imposed on such person under this Act.
37. Penalty for offences
where no separate punishment has been provided. - Whoever fails
to comply with any provision of this Act for which no separate penalty has been
provided in this Act shall be punished with imprisonment for a term which may
extend to one year, or with fine or with both.
38. Prohibition of
acceptance of foreign contribution. - Notwithstanding anything
contained in this Act, whoever, having been convicted of any offence under
section 35 or section 37, in so far as such offence relates to the acceptance
or utilisation of foreign contribution, is again convicted of such offence
shall not accept any foreign contribution for a period of five years from the
date of the subsequent conviction.
39. Offences by companies.
- (1) Where an offence under this Act or any rule or order made thereunder
has been committed by a company, every person who, at the time the offence was
committed, was in charge of, and was responsible to, the company for the
conduct of the business of the company, as well as the company, shall be deemed
to be guilty of the offence and shall be liable to be proceeded against and
punished accordingly:
Provided that nothing contained in this sub-section
shall render such person liable to any punishment if he proves that the offence
was committed without his knowledge or that he had exercised all due diligence
to prevent the commission of such offence.
(2) Notwithstanding anything contained in
sub-section (1), where an offence under this Act or any rule or order made
thereunder has been committed by a company and it is proved that the offence
has been committed with the consent or connivance of, or is attributable to any
neglect on the part of, any director, manager, secretary or other officer of
the company, such director, manager, secretary or other officer shall also be
deemed to be guilty of that offence and shall be liable to be proceeded against
and punished accordingly.
Explanation.—For the
purposes of this section,—
(a) “company” means any body corporate
and includes a firm, society, trade union or other association of individuals;
and
(b) “director”, in relation to a
firm, society, trade union or other association of individuals, means a partner
in the firm or a member of the governing body of such society, trade union or
other association of individuals.
40. Bar on prosecution of
offences under the Act. - No court shall take
cognizance of any offence under this Act, except with the previous sanction of
the Central Government or any officer authorised by that Government in this
behalf.
41. Composition of certain
offences. - (1) Notwithstanding anything contained in the Code
of Criminal Procedure, 1973, any offence punishable under this Act (whether
committed by an individual or association or any officer or employee thereof),
not being an offence punishable with imprisonment only, may, before the
institution of any prosecution, be compounded by such officers or authorities
and for such sums as the Central Government may, by notification in the Official
Gazette, specify in this behalf.
(2) Nothing in sub-section (1) shall apply to an
offence committed by an individual or association or its officer or other
employee within a period of three years from the date on which a similar
offence committed by it or him was compounded under this section.
Explanation.— For the
purposes of this section, any second or subsequent offence committed after the
expiry of a period of three years from the date on which the offence was
previously compounded, shall be deemed to be a first offence.
(3) Every officer or authority referred to in
sub-section (1) shall exercise the powers to compound an offence, subject to
the direction, control and supervision of the Central Government.
(4) Every application for the compounding of an
offence shall be made to the officer or authority referred to in sub-section
(1) in such form and manner along with such fee as may be prescribed.
(5) Where any offence is compounded before the
institution of any prosecution, no prosecution shall be instituted in relation
to such offence, against the offender in relation to whom the offence is so
compounded.
(6) Every officer or authority referred to in
sub-section (1), while dealing with a proposal for the compounding of an
offence for a default in compliance with any provision of this Act which
requires by an individual or association or its officer or other employee to
obtain permission or file or register with, or deliver or send to, the Central
Government or any prescribed authority any return, account or other document,
may, direct, by order, if he or it thinks fit to do so, any individual or
association or its officer or other employee to file or register with, such
return, account or other document within such time as may be specified in the
order.
CHAPTER IX
Miscellaneous
42. Power to call for
information or document. - Any inspecting officer
referred to in section 23 who is authorised in this behalf by the Central
Government may, during the course of any inspection of any account or record maintained
by any political party, person, organisation or association in connection with
the contravention of any provision of this Act, —
(a) call for information from any
person for the purpose of satisfying himself whether there has been any contravention
of the provisions of this Act or rule or order made thereunder;
(b) require any person to produce
or deliver any document or thing useful or relevant to such inspection;
(c) examine any person acquainted
with the facts and circumstances of the case related to the inspection.
43. Investigation into
cases under the Act. - Notwithstanding anything
contained in the Code of Criminal Procedure, 1973, any offence punishable under
this Act may also be investigated into by such authority as the Central
Government may specify in this behalf and the authority so specified shall have
all the powers which an officer-in-charge of a police station has while making
an investigation into a cognisable offence. 44. Returns by prescribed authority
to Central Government. -The prescribed authority shall furnish to the Central
Government at such time and in such form and manner such returns and statements
as may be prescribed.
45. Protection of action
taken in good faith. - No suit or other legal
proceedings shall lie against the Central Government or the authority referred
to in section 44 or any of its officers in respect of any loss or damage caused
or likely to be caused by anything which is in good faith done or intended to
be done in pursuance of the provisions of this Act or, any rule or order made
thereunder.
46. Power of Central
Government to give directions. - The Central Government may
give such directions as it may deem necessary to any other authority or any
person or class of persons regarding the carrying into execution of the
provisions of this Act.
47. Delegation of powers.
- The Central Government may, by notification, direct that any of its powers
or functions under this Act, except power to make rule under section 48, shall,
in relation to such matters and subject to such conditions, if any, may be
specified in the notification, be exercised or discharged also by such
authority as may be specified.
48. Power to make rules.
- (1) The Central Government may, by notification, make rules for carrying
out the provisions of this Act.
(2) In particular, and without prejudice to the
generality of the foregoing power, such rules may provide for all or any of the
following matters, namely:—
(a) the value of the article which
may be specified under sub-clause (i) of clause (h) of sub-section (1) of
section 2;
(b) the authority which may be
specified under clause (p) of sub-section (1) of section 2;
(c) acceptance or retention of
gift or presentation under clause (d) of section 4;
(d) guidelines specifying the
ground or grounds on which an organisation may be specified as an organisation
of political nature under sub-section (1) of section 5;
(e) the activities or business
which shall be construed as speculative business under the proviso to clause
(a) of sub-section (1) of section 8;
(f) the elements and the manner in
which the administrative expenses shall be calculated under sub-section (2) of
section 8;
(g) the time within which and the
manner in which any person or class of persons or an association may be required
to furnish intimation regarding the amount of foreign contribution received
under clause (c) of section 9;
(h) the time within which and the
manner in which any person or class of persons may be required to furnish
intimation regarding foreign hospitality under clause (e) of section 9;
(i) the manner in which the copy
of the order of the Central Government shall be served upon any person under
section 10;
(j) the form and manner in which
the application for grant of certificate of registration or giving of prior
permission under sub-section (1) of section 12;
(k) the fee to be accompanied by
the application under sub-section (1) of section 12;
(l) the terms and conditions for
granting a certificate or giving prior permission under clause (g) of
sub-section (4) of section 12;
(m) the manner of utilising the
foreign contribution under clause (b) of subsection (2) of section 13;
(n) the authority with whom the
foreign contribution to be vested under subsection (1) of section 15;
(o) the period within which and
the manner in which the foreign contribution shall be managed under sub-section
(2) of section 15;
(p) the form and manner in which
the application for a renewal of certificate of registration shall be made
under sub-section (2) of section 16;
(q) the fee to be accompanied by
the application for renewal of certificate under sub-section (2) of section 16;
(r) the prescribed amount of
foreign remittance, the form and manner in which the foreign remittance
received by every bank or authorised person in foreign exchange shall be
reported under sub-section (2) of section 17;
(s) the time within which and the
manner in which the person who has been granted certificate of registration or
given prior permission under this Act shall give intimation under section 18;
(t) the form and manner in which
account of any foreign contribution and the manner in which such contribution
has been utilised shall be maintained under section 19;
(u) the time within which and the
manner in which a candidate for election shall give intimation under section
21;
(v) the manner and procedure to be
followed in disposing of the assets under section 22;
(w) the limits subject to which
any confiscation may be adjudged under clause (b) of sub-section (1) of section
29;
(x) the fee to be accompanied
along with every application for revision under sub-section (5) of section 32;
(y) the form and manner for making
of an application for compounding of an offence and the fee therefor under
sub-section (4) of section 41;
(z) the form and manner in which
and the time within which returns and statements to be furnished by the
prescribed authority under section 44;
(za) any other matter which is
required to be, or may be, prescribed.
49. Orders and rules to be
laid before Parliament. - Every order made under
section 5 and every rule made by the Central Government under this Act shall be
laid, as soon as may be after it is made, before each House of Parliament while
it is in session for a total period of thirty days which may be comprised in
one session or in two or more successive sessions, and if, before the expiry of
the session immediately following the session or the successive sessions
aforesaid, both Houses agree in making any modification in the order or rule or
both Houses agree that the order or rule should not be made, the order or rule
shall thereafter have effect only in such modified form or be of no effect, as
the case may be; so, however, that any such modification or annulment shall be
without prejudice to the validity of anything previously done under that order
or rule.
50. Power to exempt in
certain cases. - If the Central Government is of opinion that it is
necessary or expedient in the interests of the general public so to do, it may,
by order and subject to such conditions as may be specified in the order,
exempt any person or association or organisation (not being a political party),
or any individual (not being a candidate for election) from the operation of
all or any of the provisions of this Act and may, as often as may be necessary,
revoke or modify such order.
51. Act not to apply to
certain Government transactions. - Nothing contained in this
Act shall apply to any transaction between the Government of India and the
Government of any foreign country or territory.
52. Application of other
laws not barred. - The provisions of this Act shall be in addition to,
and not in derogation of, the provisions of any other law for the time being in
force.
53. Power to remove
difficulties. - (1) If any difficulty arises in giving effect to
the provisions of this Act, the Central Government may, by order, published in
the Official Gazette, make such provisions not inconsistent with the provisions
of this Act as may appear to be necessary for removing the difficulty:
Provided that no order shall be made under this
section after the expiry of two years from the commencement of this Act.
(2) Every order made under this section shall be
laid, as soon as may be after it is made, before each House of Parliament.
54. Repeal and saving.
- (1) The Foreign Contribution (Regulation) Act, 1976 (hereafter referred to
as the repealed Act) is hereby repealed.
(2) Notwithstanding such repeal,—
(a) anything done or any action
taken or purported to have been done or taken under the repealed Act shall, in
so far as it is not inconsistent with the provisions of this Act, be deemed to
have been done or taken under the corresponding provisions of this Act;
(b) any organisation of a
political nature, not being a political party, to whom the prior permission was
granted under section 5 of the repealed Act, shall continue to be the
organisation of a political nature, not being a political party, under clause
(f) of sub-section (1) of section 3 of this Act, till such permission is
withdrawn by the Central Government;
(c) permission to accept foreign
hospitality granted under section 9 of the repealed Act shall be deemed to be
the permission granted under section 6 of this Act until such permission is
withdrawn by the Central Government;
(d) any association prohibited
from accepting any foreign contribution under clause (a) of section 10 of the
repealed Act, in so far as it is not inconsistent with the provisions of this
Act, shall be deemed to be an association prohibited from accepting any foreign
contribution under section 9 of this Act;
(e) permission obtained under
clause (b) of section 10 of the repealed Act shall, in so far as it is not
inconsistent with the provisions of this Act, be deemed to be the permission
until such permission is withdrawn by the Central Government;
(f) any order issued under section
12 of the repealed Act shall be deemed to be an order issued under section 10
of this Act;
(g) any order issued under section
31 of the repealed Act exempting any association or any individual shall be
deemed to be an order under section 50 of this Act till such order is varied or
revoked.
(3) Save as provided in sub-section (2), mention of
particular matters in that subsection shall not be held to prejudice or affect
the general application of section 6 of the General Clauses Act, 1897, with
regard to the effect of repeal.
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