Acceptance and utilization of foreign contribution and hospitality by associations whether incorporated or not, is regulated by the provisions of the Foreign Contributions(Regulation)Act, 2010.Associations/bodies incorporated under the a Central/sate Act shall be exempt from the provisions of the Act. Therefore both Associations registered as well as unregistered under the Act but having prior permissions from the government are entitled to receive foreign contributions. All such registered associations have to give an account of the source of their contributions to the central government. Such organization have also to get a particular Bank account registered with the Government through which alone all such contributions can be received. Yet not all voluntary organizations are entitled to receive foreign contributions like Political Parties, printers, publishers, editors, journalist and those covered under the Press & Registrations Act, members of the legislature/parliament etc.
The importance attached with the FCRA Certificate can be gauged by the fact that under law it is the duty of the donor organization to ensure that no foreign contribution is transferred to any entity that is not registered under the FCRA or has prior permissions from the government. Getting a FCRA certificate ensures that the NGO are entitled to all forms of grants coming from external sources with minimal harassment/wastage of time, in getting clearances. The government also strictly monitors the utilization of these foreign contributions with the law mandating that all Registered organization are supposed to file their returns pertaining to the use of these foreign contribution within 90 days from the year closing March 31 under Form FC-6.