Non Government Organisation
Foreign Exchange Regulation Act
Foreign Contribution Regulation Act
Laws relating to NGOs are mainly governed by FCRA with special emphasis on
monitoring of foreign fund receipt by social organisations . FCRA has made
it compulsory for organisations to seek prior approval or permanent
registration to receive finds from foreign sources.
What is an NGO?
The word NGO is an abbreviation of Non Government Organisation. Any
organisation working for a social, cultural, economic, educational or
religious cause is termed as NGO.
What are the different kinds of legal status an NGO can have ?
An NGO can
be formed under various legal forms:
(Formed under a Trust deed and registered with Income Tax Authority.)
registered under Societies Registration Act.
company incorporated under section 25 of The Companies Act.
What kind of
activities an NGO can undertake ?
NGOs can undertake any lawful activity allowed under their Charter or
Memorandum of Association.
the conditions for transfer of funds by NGOs?
Any NGO accepting foreign contribution should register itself with the
Central Government. It has to intimate the Central Government of 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 it.
Any association which is not registered with the Central Government shall
accept any foreign contribution only after obtaining the prior permission
from the Central Government and should also give intimation to the Central
Government as the registered association does.
What do the terms Foreign contribution, and foreign sources signify ?
Foreign contribution signifies donation, delivery or transfer made by any
foreign source of any article or currency or foreign securities as defined
Foreign sources includes the following : -
(i) the Government of any foreign country or its agency ,
(ii) any international agency other than the agency specified by the
(iii) a foreign company as specified in section 591 of the Companies Act
including a subsidiary of a foreign company.
(iv) a corporation incorporated in a foreign country or territory,
(v) a multi-national corporation within the meaning of this Act,
(vi) An Indian company controlled by a foreign government, citizens of a
foreign country, corporation incorporated in foreign country, Trusts,
society body of individuals incorporated in a foreign country.
(vii) a trade union in any foreign country or territory, whether or not
(viii) a foreign trust or foundation
(ix) a society, club or other association of individuals formed or
registered outside India,
(x) a citizen of a foreign country,
organisations get any Income Tax benefits ?
Yes, income received by any religious or charitable trust, any other fund
or institution established for religious or social purpose is not taxable
provided the income is applied for the objects of the organisation.
However, to get exemption under Income Tax, it is essential for NGOs to
register themselves with Income Tax Authorities.
Income Tax Benefits to Donors
People donating to these religious and charitable organisations also get
an exemption of the amount of donation. The amount donated is either 100
percent or 50 percent exempt. The percentage of exemption differs for
different organisations and is specified by authorities.
Are there any restrictions on acceptance of foreign contributions in
Yes, there are certain restrictions on acceptance of foreign contributions
1. Any political party whether on its own or through its officers or
representatives cannot accept any foreign contribution. Similarly, any
citizen or resident of India shall neither accept nor deliver any currency
which is accepted from any foreign source, to any political party directly
2. Organisations of political nature cannot accept any foreign
contribution without prior permission of the government. Similarly, a
resident or citizen of India shall neither accept nor deliver any currency
for a political organisation.
3. Any person receiving any currency from a foreign source on behalf of
any association, shall deliver such currency only to the organisation or
its representative for which it was received.
4. Any candidate for election, who had received any foreign contribution
within 182 days preceding the date on which he is duly nominated as
candidate should give an intimation to the Central Government stating the
amount of foreign contribution received 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
However, the persons receiving foreign contributions in the following form
need not taken prior permission from the central govt.:-
(a) salary, wages or other remuneration either to individual or payment
for business purposes.
(b) payment for international trade or for business transacted by him
(c) by way of a gift or presentation received as member of any Indian
(e) Gift not exceeding Rs.8000 per annum
Are there also some rules that have to be followed in case of persons
receiving scholarships from foreign sources?
Yes, any Indian citizen who receives any scholarship, stipend or any such
payment from any foreign source should give an intimation to the Central
Government within specified time of the amount, purpose, source and
intervals of such payment rec’d by him. However, no such intimation is
required if the scholarship received is upto Rs.36000/- during an academic
Grants in aid from the Govt. of India:
Govt. of India allocates the grants in aid for
carrying out the specific programmes as well as for block general
purposes. These grants are made out to voluntary organisations who are
involved in implementing these programmes. Grants-in-aid has been defined
as the sum which a superior authority assigns to an inferior authority.
For allocation of the financial resources, the Govt. of India has framed
General Financial Rules for deciding the right agency. By and large the
rules and conditions governing these specific schemes flow from the
grants-in-aid rules mentioned in these schemes of the various ministries
and departments. Some of these rules and conditions are given below:
organisations / institution/ agency should be registered under an
appropriate act such as Societies Registration Act, 1860, Charitable
Trusts Act, Cooperative Societies Act or under any law in force.
organisations seeking funds should be a recognised and reputed one; its
work should be reported satisfactory by the concerned department of the
State Govt. or the U. T. administration.
It must be a
properly constituted broad based Managing /Executive Committee with its
powers , duties and responsibilities clearly defined and laid down in a
have been engaged in social welfare /development activities for a
minimum period of 3 years oprior to seeking the grant.
programmes and services of the voluntary organisations should be open to
all irrespective of caste , creeed and religion.
organisations must be financially sound. It must have facilities ,
research, personnel and experienced staff for undertaking activities for
which grant is allocated.
not be a profit oriented body benefitting any specific individual or a
group of individuals.
organisations must execute a bond, that it will abide by all the
conditions of grant, failing which the grant shall be refunded.
agency must accept the right of grantor to inspect the aided agency at
any time in order to study its working and to ensure proper utilization
should be able to generate its own resources including the contributions
from the community.
not be utilised for purposes other than those for which it issanctioned.
should have certain methods and procedures relating to budgets,
accounting and audit of the grants sanctioned.
institutes shall maintain separate accounts of the programmes for which
the grant is received, distinct from the accounts of its normal
of grant may be stopped or earlier grants recovered if the grantor is
not satisfied with the utilisation of funds for the stated objectives.
agency should submit the duly audited accounts as and when required.
organisations should submit the progress reports as specified in the
organisations should maintain an account with a bank or a post office in
the name of the institutions , to be operated by at least two office
organisations are prohibited from handing over the funds and the
implementation of the programmes to another organisations.
should be audited by a Chartered Accountant or a govt. authority within
two months from the close of the financial year.
not be allocated for the same purposes if already financed by some other
deptt. of the Central Govt.
balance of the grant should be refunded at the close of the year.
must guarantee that the assets acquired out of the grants funds shall
not be sold, dispossessed or alienated, encumbered, mortgaged at any
time for purposes other than those for which grant is sanctioned. A
record of such assets should be maintained by the grantee in the form
prescribed by the grant-giving agency.
There are various schemes sponsored by the
various central Government ministries such as Ministry of Social Justice
and Empowerment, Ministry of Health and Family Welfare, Ministry of Human
Resources Development. The applicant voluntary organisations applying for
such grants in aid should file these through the relevant state level
department. The recommendations made by these departments shall be
considered while sanctioning these grants.
sponsored by the Ministry of Social Justice and Empowerment, Shashtri
Bhawan, New Delhi
Name of the scheme
Purposes and the eligibility
1. Scheme for Welfare of children in need
of care and Protection
The main purposes of the scheme is to
rehabilitate destitute children as normal citizens of the country. The
scheme seeks to provide individualized and personal care to destitute
children with the help of institutional and non institutional care.
The scheme is implemented through
registered voluntary ( national level) organisation.
2. Scheme for Foster Care Services
The objective of the scheme is welfare of
the destitute children by providing the homely atmosphere to those who
become destitute at an early age.
It is made available to reputed V.O.
working in the field of promoting foster care services in India.
3.Organisational assistance to Voluntary
social welfare organisations
The objective is to provide assistance to
voluntary organisations with a view of developing their organisational
4. Scheme for Assistance to disabled
persons for purchases /fittings/of aids/appliances
The main objective is to assist needy
physically handicapped persons in procuring quality and modern aids
and appliances that can promote their physical rehabilitation.
The eligible are the individuals who are
5. Grants in aid for sponsoring research
on rehabilitation of the handicapped
The projects are intended to help in
finding the solutions to the problems of the handicapped and
facilitate their effective rehabilitation .The projects under this
sponsoring shall be of an applied nature and result and action
6. Scheme of assistance to organisations
for disabled persons
The scheme seeks to provide financial
assistance mainly for developing services in the area of prevention of
disabilities, early detection and intervention ; education , training
7.Assistance to Voluntary agencies for
prevention, detection and management of Childhood disabilities.
This scheme is jointly promoted by the
Govt. of India and UNICEF. It seeks projects of non governmental
organisations having a focus on preventive and early detection of
disability among children. Projects eligible for this assistance would
include community and family based rehab. programmes for disabled
children; efforts aimed at creating awareness among families and
community leaders ; innovative programmes of training in early
detection /intervention methods for families etc.
8.Grants in aid rules for sponsoring
The scheme provides assistance for
conducting research in the field of social welfare, social policy and
social development. Priorities with in these broad areas will be given
to projects of an applied nature keeping in view plan policies and
9. Grants in aid rules for sponsoring
Grants are provided for publications of
studies and documentation in the field of social welfare and policy
10. Grants in aid for Workshops / seminars
The Ministry also provides financial
assistance for organising workshops /seminars which will help
disseminate research findings, identify problems areas , discuss
problems and identify research needs etc. in the broad field of social
welfare , social policy and social development.
11. Grant-in-aid rules for supporting
projects (Tribal Development) of all India or Inter state nature
The scheme aims at supporting action
oriented studies on problems of scheduled tribes particularly in the
field of economic development for generation at necessary data to
improve formulations and implementations of tribal developmental prgs.
sponsored by the Ministry of Human Resource Development Shashtri Bhawan ,
12. Scheme of assistance for construction/
extension of Hostel buildings for working women with a day care centre
The scheme seeks to provide suitable
accommodation in healthy environment for the working women and day
13.Scheme for short stay homes for women
14.Scheme for setting up women’s training
centres/institutes for rehab. of women in distress
The main objective is to rehabilitate
destitute women through vocational trainings and residential care.
15.Scheme for organisational assistance to
voluntary organisations for women and child development
The scheme seeks to support and help the
V.O. for women and children to maintain their central offices, a vital
input in the running of their activities.
16.Scheme of Nutrition programmes
through Balwadis and Day care centres for
pre school children in the age group of 3 to 5 years.
The programme seeks to provide
supplementary food for children in the age of 3-5 years and envisage
that it would form a basis for the development of other services like
health, education and welfare.
17.Scheme for assistance to V.O. working
in the field for adult education
Promotion of adult education and
eradication of mass illiteracy
18. Scheme of assistance to V.O. for early
(Universalisation of education)
Early Childhood education programmes
sponsored by the Ministry of Health and Family Welfare, New Delhi
1. Scheme for improvement of health
The scheme seeks to provide the medical
care to rural and high density urban slums for expansion and
improvements of existing nursing facilities.
2.Schemes for sanctioning grants-in-aid
for promoting the voluntary blood donations camps
The scheme seeks to promote intensive and
extensive education of the public and motivate them to donate the
3.Grants to Under graduate college of
Indian Systems of Medicines and Homeopathy run by the V.O.
The scheme seeks to provide the financial
assistance with a view to improve the standard of education in the
undergraduate ISM and homeopathy colleges for the purchase of lab.
equipment and setting up of the book banks.
4.Grants-in-aid to the V.O. engaged in the
Family welfare programmes
The scheme seeks to encourage V.O. to take
up the family welfare programmes by running the Family welfare centres.
schemes sponsored by various ministries
Concerned Department /Board
National Wasteland Development Board
Lok Nayak Bhawan, New Delhi
Scheme for Grant of Financial assistance
The objective under this scheme is to
bring under productive uses the wastelands in the country through a
massive programme of afforestation and trees planting. The major steps
include identification of lands, motivation of villagers, assisting
the villagers wither as a group in obtaining tres rights on lands etc.
The Board shall emphasis on the issues
relating to laying of nurseries, forestry and pasteur development
activities and development of culturable wasteland including
improvements of land .
National Fund for Rural Development
(Department for Rural development) Krishi Bhawan New Delhi
Scheme for rural Development
The Govt. accords highest priority to
programmes of rural development for attaining the objectives of
increasing agricultural production, creating employment, eradicating
poverty and bringing overall improvement in the rural economy.
Projects qualifying for these assistance:
-construction and maintenance of rural
-construction and maintenance of drinking
-construction and maintenance of hospitals
-establishment of rural industries and
animal product units for generating employment in rural areas