FOREIGN CONTRIBUTION REGULATION ACT, 1976

S.1 Short title, extent, application and commencement

       (1) This Act may be called the Foreign Contribution (Regulation) Act, 1976.
       (2) It extends to the whole of India, and it shall also apply to—
       (a) citizens of India outside India; and
       (b) associates, branches or subsidiaries, outside India, of companies or bodies corporate, registered or incorporated in India.
       (3) It shall come into force on such date1 as the Central Government may, by notification in the Official Gazette, appoint.


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        1. 5th August, 1976, vide G.S.R. 755(E), dated 5th August, 1976.

S.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 (21 of 1860), or not, and any other organisation, by whatever name called;
       (b) “candidate for election” means a person who has been duly nominated as a candidate for election to any Legislature;
       (c) “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, does not exceed one thousand rupees;

S.3 Application of other laws not barred

The provisions of this Act shall be in addition to, and not in derogation of, any other law for the time being in force.

S.4 Candidate for election, etc., not to accept foreign contribution

       (1) No foreign contribution shall be accepted by any—
       (b) correspondent, columnist, cartoonist, editor, owner, printer or publisher of a registered newspaper,
       (c) 1[Judge, Government servant] or employee of any corporation,
       (d) member of any Legislature,
       (e) political party or office-bearer thereof.
       Explanation.—In clause (c) and in section 9, “corporation” means a corporation owned or controlled by Government and includes a Government company as defined in section 617 of the Companies Act, 1956 (1 of 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

S.5 Organisation of a political nature not to accept foreign contribution except with the prior permission of the Central Government

       (1) No organisation of a political nature, not being a political party, shall, accept any foreign contribution except with the prior permission of the Central Government.
       Explanation.—For the purposes of this section, “organisation of a political nature, not being a political party” means such organisation as the Central Government may, having regard to the activities of the organiation or the ideology propagated by the organisation or the programme of the organisation or the association of the organisation with the activities of any political party, by an order published in the Official Gazette, specify in this behalf.
       (2) (a) Except with the prior permission of the Central Government, 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

S.6 Certain associations and persons receiving foreign contribution to give intimation to the Central Government

       1[(1) No association [other than an organisation referred to in sub-section (1) of section 5] having a definite cultural, economic, educational, religious or social programme shall accept foreign contribution unless such association,—
       (a) registers itself with the Central Government in accordance with the rules made under this Act; and
       (b) agrees to receive such foreign contributions only through such one of the branches of a bank as it may specify in its application for such registration,
       and every association so registered shall give, within such time and in such manner as may be prescribed, an intimation to 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 purp

S.7 Recipients of scholarships, etc., to give intimation to the Central Government

       (1) Every citizen of India receiving any scholarship, stipend or any payment of a like nature from any foreign source shall give, within such time and in such manner as may be prescribed, an intimation to the Central Government as to the amount of the scholarship, stipend or other payment received by him and the foreign source from which, and the purpose for which, such scholarship, stipend or other payment has been, or is being, received by him.
       (2) Where any recurring payments are being received by any citizen of India from any foreign source by way of scholarship, stipend or other payment, it shall be sufficient if the intimation referred to in sub-section (1) includes a precise information as to the intervals at which, and the purpose for which, such recurring payments will be received by such citizen of India.
       (3) It shall not be n

S.8 Persons to whom section 4 shall not apply

       Nothing contained in section 4 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 Government; or
       (d) by way of a gift or presentation

S.9 Restrictions on acceptance of foreign hospitality

       No member of a Legislature, office-bearer of a political party, 1[Judge, Government servant] or employee of any corporation 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.

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S.10 Power of Central Government to prohibit receipt of foreign contribution, etc., in certain cases

       The Central Government may—
       (a) prohibit any association, not specified in section 4, or any person, from accepting any foreign contribution;
       (b) 1[without prejudice to the provisions of sub-section (1) of section 6, require any association specified in that sub-section], to obtain prior permission of the Central Government before accepting any foreign contribution;
       (c) require any person or class of persons or any association, not being an association specified in section 6, 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 or association, 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 th

S.11 Application to be made in prescribed form for obtaining prior permission to accept foreign contribution or hospitality

       (1) Every individual, association, organisation or other person, who is required by or under this Act to obtain the prior permission of the Central Government to accept any foreign contribution or foreign hospitality, shall, before the acceptance of any such contribution or hospitality make an application for such permission to the Central Government if such form and in such manner as may be prescribed.
       (2) If an application referred to in sub-section (1) is not disposed of within ninety days from the date of receipt of such application, the permission prayed for in such application shall, on the expiry of the said period of ninety days, be deemed to have been granted by the Central Government:
       Provided that, where, in relation to an application, the Central Government has informed the applicant the special difficulties by reason of whic

S.12 Power to prohibit payment of currency received in contravention of the Act

Where the Central Government is satisfied, after making such enquiry as it may deem fit, that any person has in his custody or control any article or currency, 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 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 (37 of 1967), shall, so far as may be, apply to, or in relation to, such article or currency and references in the said sub-sections to moneys, securities or credits shall be construed as references to such article or currency.

S.13 Recipients of foreign contribution to maintain accounts, etc.

       Every association, referred to in section 6, shall maintain, in such form and in such manner as may be prescribed,—
       (a) an account of any foreign contribution received by it, and
       (b) a record as to the manner in which such contribution has been utilised by it.

S.14 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 1[Group A post], as it may think fit (hereinafter referred to as the authorised 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 authorised officer shall have the right to enter in or upon any premises at any reasonable hour, before sunset and after sunris

S.15 Seizure of accounts or records

If, after inspection of an account or record referred to in section 14, the authorised 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 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.

S.15(a) Audit of accounts

Where any organisation or association fails to furnish any returns under this Act within the time specified therefor or the returns so furnished are not in accordance with law or if, after inspection of such returns, the Central Government has any reasonable cause to believe that any provision of this Act has been, or is being, contravened, that Government may, by general or special order, authorise such gazetted officer, holding a Group A post, as it may think fit, to audit any books of account kept or maintained by such organisation or association, as the case may be, 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 fo

S.16 Seizure of article or currency received in contravention of the Act

If any gazetted officer, authorized 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 rupees one thousand in value, or currency, 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.

S.17 Seizure to be made in accordance with the Code of Criminal Procedure, 1973

Every seizure made under this Act shall be made in accordance with the provision of section 100 of the Code of Criminal Procedure, 1973 (2 of 1974).

S.18 Confiscation of article or currency obtained in contravention of the Act

Any article or currency which is seized under section 16 shall be liable to confiscation if such article or currency has been adjudged under section 19 to have been received or obtained in contravention of this Act.

S.19 Adjudication of confiscation

       Any confiscation referred to in section 18 may be adjudged—
       (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 Session Judge, as the Central Government may, by notification in the Official Gazette, specify in this behalf.

S.20 Opportunity to be given before adjudication of 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 has been seized.

S.21 Appeal

       (1) Any person aggrieved by any order made under section 19 may prefer an appeal,—
       (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 section 19, 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.
      &nbs

S.22 Penalty for article or currency obtained in contravention of section 12

If any person, on whom any prohibitory order has been served under section 12, pays, delivers, transfers or otherwise deals with, in any manner whatsoever, any article or currency, 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 (2 of 1974), 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 in respect of which the prohibitory order has been contravened by him or such part thereof as the court may deem fit.

S.23 Punishment for the contravention of any provision of the Act

(1) Whoever accepts, or assists any person, political party or organization in accepting any foreign contribution or any currency from a foreign source, in contravention of any provision of this Act or any rule made thereunder, shall be punished with imprisonment for a term which may extend to five years, or with fine, or with both.
(2) Whoever accepts any foreign hospitality in contravention of any provision of this Act or any rule made thereunder, shall be punished with imprisonment for a term which may extend to three years, or with fine, or with both.

S.24 Power to impose additional fine where article or currency is not available for confiscation

Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), the Court trying a person, who, in relation to any article or currency, whether Indian or foreign, does or omits to do any act which act or omission would render such article or currency 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 one thousand rupees, whichever is more, if such article or currency 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.

S.25 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 of a term which may extend to one year, or with fine not exceeding one thousand rupees, or with both.

S.25(a) Prohibition of acceptance of foreign contribution

       Notwithstanding anything contained in this Act, whoever, having been convicted of any offence under sub-section (1) of section 23 or section 25, 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 three years from the date of the subsequent conviction.]

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        1. Ins. by Act 1 of 1985, sec. 9 (w.r.e.f. 20-10-1984).
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S.26 Offences by companies

       (1) Where an offence under this Act or any rule made there under 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 it 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 made thereunder has been committed by a company and it is proved that the offence has been commit

S.27 Bar to the 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 authorized by that Government in this behalf.

S.28 Investigation into cases under the Act

Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), 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 cognizable offence.

Legal Commentary on Section 28 of the Foreign Contribution Regulation Act, 1976

Introduction

The Foreign Contribution Regulation Act (FCRA), 1976 was enacted to regulate the acceptance and utilization of foreign contributions by individuals and organizations in India. Section 28 specifically addresses the investigation of cases under this Act, ensuring compliance and accountability in the handling of foreign contributions.

What Section 28 Says

Section 28 empowers designated authorities to investigate any violations of the provisions of the FCRA. It allows for the examination of records, accounts, and other documents related to foreign contributions.

Essential Ingredients

Authority: Designated authorities are empowered to conduct investigations.
Scope of Investigation: The investigation can include records, accounts, and documents.
Compliance: The section aims to ensure compliance with the provisions of the FCRA.

Scope of Section

The scope of Section 28 extends to any person or organization that is subject to the provisions of the FCRA. It encompasses a wide range of activities related to the acceptance and utilization of foreign contributions.

Punishment for Section

While Section 28 itself does not prescribe specific punishments, violations uncovered during investigations may lead to penalties as outlined in other sections of the FCRA.

Legal Comments

Keyword - "Investigation Authority" - Section 28 grants authority to designated officials to investigate violations of the FCRA. -
Keyword - "Scope of Investigation" - The investigation can cover all records and documents related to foreign contributions. -
Keyword - "Compliance Mechanism" - This section serves as a compliance mechanism to ensure adherence to the FCRA. -
Keyword - "Preventive Measure" - The provision acts as a preventive measure against misuse of foreign contributions. -
Keyword - "Legal Framework" - It is part of a broader legal framework aimed at regulating foreign contributions in India. -
Keyword - "Accountability" - Section 28 enhances accountability among organizations receiving foreign contributions. -
Keyword - "Documentation" - Organizations must maintain proper documentation to facilitate investigations. -
Keyword - "Penalties" - Violations discovered during investigations may lead to penalties as per other sections of the FCRA. -
Keyword - "Transparency" - The section promotes transparency in the handling of foreign contributions. -
Keyword - "Regulatory Oversight" - It establishes regulatory oversight over the acceptance of foreign contributions. -
Keyword - "Public Interest" - The investigations serve the public interest by preventing foreign influence in domestic affairs. -
Keyword - "Legal Recourse" - Organizations found in violation may face legal recourse as per the provisions of the Act. -
Keyword - "Central Government Role" - The Central Government plays a crucial role in approving investigations and actions taken under this section. -
Keyword - "Non-Governmental Organizations" - NGOs are particularly subject to scrutiny under this section due to their reliance on foreign contributions. -
Keyword - "Enforcement" - The section is vital for the enforcement of the FCRA and its objectives. -
Keyword - "Judicial Review" - Investigative actions taken under this section may be subject to judicial review. -
Keyword - "Public Trust" - By ensuring investigations are conducted, the section helps maintain public trust in organizations receiving foreign funds. -
Keyword - "International Standards" - The FCRA aligns with international standards for transparency and accountability in foreign funding. -
Keyword - "Impact on Civil Society" - The section has significant implications for civil society organizations operating in India. -
Keyword - "Legal Compliance" - Organizations must ensure legal compliance to avoid investigations under this section. -

S.29 Protection of action taken in good faith

No suit or other legal proceedings shall lie against the Central Government 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.

S.30 Power to make rules

       (1) The Central Government may, by notification in the Official Gazette, 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 time within which, and the manner in which, intimation is to be given by an association referred to in section 6, with regard to the foreign contributions received by it;
       (b) the limits up to which receipt of scholarships, stipends or payments of a like nature need not be intimated to the Central Government;
       (c) the time within which, and the manner in which, intimation is to be given by persons receiving any scholarship, stipend or any payment of a like n

S.31 Power to exempt

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 association (not being a political party), organisation 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.