incometax-fcra1

8/13/2019 Incometax-FCRA1

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FOREIGN CONTRIBUTION

REGULATION ACT - 1976

1. OBJECTIVE

To protect the sovereignty of the country. This act was passed to ensure that Indian

Parliamentary Institutions, Academic and Voluntary Organizations and individuals

working in important areas of National life, function in a manner consistent with the

values of Sovereign Democratic Republic.

2. SCOPE OF THIS ACT

3.Section 2, foreign contribution means the donation, delivery or

transfer made by any foreign source,

Of any article, not a gift for personal use,

The value of the gift does not exceed one thousand rupees of any currency,whether Indian or foreign

It could be a foreign security


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4. Regulations:

Absolute prohibition

FC subject to prior permission

FC subject to intimation

FC with conditions and registration

5. Absolute prohibition:

Candidate for election,

Correspondent, columnist, cartoonist, editor, owner, printer or publisher of aregistered newspaper.

Judge, Government servant or employee of any corporation,

Member of any legislature,

6. Section 8 makes certain exception:

By way of salary or remuneration

International Trade

Transactions with foreign Government

Gift received by Indian delegation within the rules

From relatives under the act.

Remittances received in the ordinary course under FEMA

Remittances received in the ordinary course under FEMA

7. With prior Permission: Section 5&6 Forms 1 & 1A

Organization of a political nature and not political party

Assn. having definite cultural, economical, educational, religious and socialprograms.


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8. OBTAINING FCRA REGISTRATION steps Section 6 1)Submit form FC 8 to m inistry of Home A ffairs along w ith the following documents:

A copy of the Trust deed

Copies of Memorandum of Association and articles of association and rulesregulations of the societyFC permission certificate if obtained

Details of the activities of the association for the past three years

Copies of the audited statements of account for the last 3 years

9. Further InformationIdentify the name of Bank/branch and account Number through which FCrecd.

Maintain separate set of accounts and records for FC recd.

Use FC6 for receiving articles

FC 7 in case of foreign securities

FC3 for submission of annual accounts: Need to be prepared without utmostcare. Fill up all the (56) heads wherever necessary.

10. Powers vested with the central Government in cases default and violations:Prohibition to receive FC/article/security in writing

Powers to inspect the records at the premises

Right to seize the records to produce before the court.

In case of faulty and false return, power to inspect and seize accountingrecords.

Power to imprison up to 5 years with fine or both.


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11. Some important amendments in 1985

Funds received by subsequent recipient were brought under

the purview of the act. Definition of political parties was enlarged to include parties

in Jammu and Kashmir.

Section 15A was inserted to empower the government toaudit and inspect books.

Section 25A inserted to prohibit receipt of funds for 3 yearsby organizations who have been convicted for the secondtime

12. Some Important Changes Proposed The New Bill

1. Objective:

To include to curb the use of FC for anti-national activities.


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5. Certain persons involved in printing and broadcasting were also

debarred from receiving FC.

6. Provision to appeal against refusal for registration and permission

were included.

7. Interest earned on FC to be treated as FC.

8. Any other income derived from FC to be treated as FC

9. 30% of the FC can be utilized for administrative expenses

10. Procedure for the disposal of assets bought from FC

11. Apart from designated Bank for receipt of FC, further accounts can be openedin bank branches for dispersal.

12. Definition of an organization of political nature included with clarity.

13. Cancellation and suspension under certain conditions.

If incorrect and false statements are made in the application

If there is violations of the provisions of the act.I in the opinion of the Registering Authority, it is necessary in the public interest or

Violation of provisions and rules of

Only after three years the organizations can reapply for registration. Beforecancellation up to 90 days the organizations can be suspended.


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Right to Information Act2005

Objective

Right to freedom of speech and expression

People will be able to make informed decisions to demand

accountability and justice from those in governance.

Information generated by using public funds to be owned by

the people. People have the right to access information about

governments actions and inactions, polices and decision

making process.


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THE RTI Act empowers

Right to Information Act 2005 empowers every citizen to

Ask any questions from the Government or seek any information (with

exceptions? Yes).

Inspect government documents and make copies of them.

Inspect Government works and if need be take samples of materials of

Government work.

Who is covered under RTI?

The RTI Act covers the whole of India except the State of Jammu and

Kashmir. All bodies, which are constituted under the Constitution or under

any law or under any Government notification or all bodies, including

NGOs, which are owned, controlled or substantially financed by the

Government.


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Who will give information?

Every govt. department will have public information offices (PIO)

Application can be submitted to PIO or APIO.

Any fee?

Rs. 10/- for central govt. (CG) department.

Different state have different rates

Rs. 2/- per page of information by CG

First hour of inspection no fee. Fubsequently Rs 5/- for every

hour-pay the fees by cash / DD / MO / IDO


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Is there an application form for seeking

information?

For Central Government Departments, there is no form available. You

should apply on a plain sheet of paper. However, stats may differ on this.

Many states and some ministries and departments have prescribed

formats.

Can I submit my application only with the PIO?

No, in case the PIO is not available you can submit your application with

the Assistant PIO (APIO) or any other officer designated to accept the

RTI applications.

Where can I locate the concerned PIO?

A list of PIOs/APIOs and Appellate Authorities for all Central and State

departments/Ministries is available online at www.rti.gov.in
http://www.rti.gov.in/http://www.rti.gov.in/http://www.rti.gov.in/http://www.rti.gov.in/http://www.rti.gov.in/http://www.rti.gov.in/http://www.rti.gov.in/http://www.rti.gov.in/


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Is there a time limit to receiving information?

Yes, there is a time limit. You must receive information within 30

days.

In case you have filed your application with Assistant PIO then

information has to be made available within 35 days.

Information has to be made available within in 48 hours. In case

of matters pertaining to life and liberty of an individual. Do I have to give reasons why I want particular information? You

are not required to give any reasons. However, you are required

to give your name, address, and Phone No.). Sec 6(2) clearly

says that no information other than contact details of the

applicant shall be asked.

Can the PIO refuse to accept my RTI application?

No. The PIO cannot refuse to accept your application for

information under any circumstances.


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V. Can the PIO refuse to give one information?

Refuse to give or 11 subjects listed in section 8

Information received from foreign govt. which are confidential in

nature, pre judicial to security, strategic or Economic interest of

the country.

18 agencies given in second schedule does not apply.

Can access be denied for file noting

File noting are an integral part of the government file access

cannot be denied.


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APPEALS

What can I do if I do not receive information?

If you do not receive information or are dissatisfied with theinformation received, you can file an appeal with the First Appellate

Authority under section 19 (1) of the right to information Act.

Who is a First Appellate Authority?

Every public authority must designate a First Appellate Authority.

Do I have to pay a fee for the first appeal?

No. You are not required to pay any fee for the first appeal.

However, some state governments have prescribed a fee.

In how many days can I file my first appeal?

You can file your first appeal within 30 days of receipt of information

or within 60 days of filing RTI application (if no information

received).


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What if I do not receive the information after the first appeal

process?

If you do not receive information even after the first appeal then you

can take the matter forward to the second appeal stage.

What is a second appeal?

A second appeal is the last option under the RTI Act to get the

information requested. You can file second appeal with the

Information Commission.


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ACTS ACADEMY OF HIGHER EDUCATION

INCOME TAX FOR NGOS AND CHARITABLE

ORGANISATIONS

1. APPLICABILITY:

IT ACT Section 4 -All organizations including charitable.ogns

income attract tax. Income includes donations and voluntary contributions.

2. EXEMPTIONS:

I. Absolute

U/S 10(23C) of Income Tax Act

A. EDUCATIONAL INSTITUTIONS Hospitals

Solely for Educational/ charity purposes and not for profit and are whollyor substantially financed by Government

And where the annual income does not exceed 100 lacs

It is adv ised to s end a NIL return


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II. Approved by Prescribed authority OR notified by Central Government

Organizations established for charitable purposesWholly for religious purposes

Educational purposes without profit

Hospitals for charitable purposes not for profit

Conditions for approval:

Government can call for documents to verify the genuineness.

The income should be applied for the stated object.

Funds of the organizations should be deposited as per section 11(5).

Any business activity carried on should be incidental to the main objective.Separate set of books shall be maintained for the business.

Section 139(4c), file return annually.

Surplus in a year can be carried for another five years


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3. CONDITIONS FOR EXCLUSIONS

REGISTRATION

U/S.12AA, the fol lowing needs to be do ne:

Form 10A to be submitted to the commissioner of income tax with in one year offormation.

If there is a delay, sufficient reasons need to be submitted in writing.

After satisfying about the objectives, the commissioner will issue the certificate within sixmonths.

Any income derived before registration attract income tax.

No part of the income should be spent for Founder, trustee or Manager except for services

rendered. (Reasonable amount)

Charitable organization should not hold shares in a company.

Investments need to be done according to section 11(5).

If incase a charitable or religious organization, does business, which is not incidental to the

objects of the organization, then they have to pay taxes.

U/s.139, return of income needs to filed every year, failure will attract Rs.100 per day u/s.272A

U/s.139A PAN to b e obtained in form 49A.


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ACTS ACADEMY OF HIGHER EDUCATION

TAX DEDUCTION AT SOURCE

1. Payments requiring deduction of tax at source:

Payment of salary (sec.192)

Payment of interest other than interest on securities(sec194A)

Payment to contractors and sub-contractors (194c)

Payment of rent (194I)

Payment of professional Technical Services


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TAX EXEMPTION FOR NGOs U/s

11 AND 12 OF INCOME TAX ACTApplication for Registration

The fo l lowing documents are required to b e subm it ted:

i) Form 10A

ii) The original instrument under which the NGO is established, or

the Bye Laws & Memorandum of Association evidencing the

creation of the NGO should be enclosed.

iii) Two copies of the Accounts of three previous years should be

enclosed. Where the NGO was not in existence in any of three

prior years, copies of the accounts of lesser number of yearsmay be submitted.


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TRUSTS ELIGIBLE FOR

EXEMPTION U/S 11&12

i) Trusts created wholly for charitable or religious purposes

ii) Trusts created before 1.4.1952 for charitable or religiouspurposes, authorized by a general or special order of the

board, and applying their income to such purposes outside

India;

iii) Trusts created on or after 1.4.1952, for the charitable purpose

of promoting international welfare in which India is interested,

iv) Charitable trusts created for the benefit of scheduled castes,

tribes, backward classes or women and children.


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TRUSTS NOT ELIGIBLE FOR

EXEMPTION

Following trusts are not el igible for exemption under Section 11 and 12:

(a) A trust for private religious purpose, which ensures no public benefit;

(b) A charitable trust created or established on or after 1.4.1962 for the

benefit of any particular religious community or case (other than

scheduled castes/tribes, backward classes or women and children).

(c) A trust or institution for charitable or religious purposes, if any part of

its income or property is used or applied, or ensures, directly orindirectly for the benefit of a person specified u/s 13(3) for example the

founder of the trust.

(d) Any charitable or religious trust or institution, which has not invested or

deposited its funds in the modes or forms specified u/s 11(5).


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INCOME TAX-PRIVILEGES TO

THE DONORS

I. Under section 80G

a. Registration Under Section 80G

b. Documents to be Filled with Form 10G

c. Conditions to be fulfilled Under Section 80G

d. Extent of Benefit


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MEANING OF CHARITABLE PURPOSE

The Charitable purpose includes relief of the poor, education, medical reliefand any other object of general public utility. A purpose must in order to be

charitable, be directed to the benefit of the community or a section of the

community, as distinguished from an individual or a group of individuals.

MEANING OF RELIGIOUS PURPOSE

The expression religious purpose has not been defined under the Act.

Religiouspurposesare necessarily associated with religion. Religious purpose

includes the advancement, support or propagation of religion and its tenets.

The income of a religious trust or institution is entitled to exemption eventhough it may be for the benefit of a particular religious community or caste.

The exemption u/s 11 is however confined to public religious trusts only; any

income from the property held under the trust for private religious purposes

which does not ensure for the benefit of the public is not exempt.