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Union of India - Section
Section 11 in The Foreign Contribution (Regulation) Act, 1976
11.
/552Amendment Act 1 of 1985-Statement of Objects and Reasons.-The Foreign Contribution (Regulation) Act, 1976, seeks to regulate the acceptance and utilisation of foreign contribution or foreign hospitality by certain categories of persons or associations. To remove certain inadequacies and practical difficulties in the administration of the Act, a Bill to amend the Act was introduced in the Rajya Sabha in May, 1984. The Bill was passed by the Rajya Sabha with certain amendments. But it could not be passed by the Lok Sabha before it adjourned at the end of its Monsoon Session and the Bill has now lapsed. As, it was considered necessary to give effect to the provisions of the Bill as passed by the Rajya Sabha urgently, the Foreign Contribution (Regulation) Amendment Ordinance, 1984, was promulgated by the President on the 20th October, 1984. The said Ordinance, inter alia, made the following amendments in the Act, namely:-(i) The definition of "foreign contribution", as contained in the Act, included only the donation, delivery or transfer made by any foreign source. It did not include donation or contribution received by an organisation from another organisation from out of foreign contribution received by the latter organisation. The definition was enlarged to include such contributions also for the purpose of tracing the utilisation of foreign contribution down the line.(ii) The definition of "political party", as contained in the Act, did not include political parties in the State of Jammu and Kashmir and political parties which are not covered by the Election Symbols (Reservation and Allotment) Order, 1968. The Ordinance amended this definition to include such political parties also.(iii) Section 6(1) of the Act provided that every association having a definite cultural, economic, educational, religious or social programmes, may receive foreign contribution, but was required to send intimation regarding such receipt to the Central Government within such time and in such manner to be prescribed by the rules made under the Act. It had been observed that a number of associations had not sent such intimation. In order to effectively monitor the receipt of foreign contribution, this sub-section was amended to provide that associations referred to therein shall accept foreign contribution only after they are registered with the Central Government specifically for the purpose and accept such contributions only through a specified branch of a hank. They would, however, be required to give, within such time and in such manner as may be prescribed, intimation to the Central Government as to the amount of foreign contribution received by them, the source from which and the mariner in which such foreign contribution was received by them, etc. Where any registered association does not accept foreign contribution through the specified branch of a specified bank or does not submit intimations, etc., in time, the Central Government has been empowered to direct that such association shall not accept foreign contribution without the prior permission of the Central Government. A new sub-section (1-A) had also been included in this section to provide that an association not so registered with the Central Government shall obtain prior permission of the Central Government before accepting any foreign contribution and also give intimation to the Central Government as to the amount of contribution received by it.(iv) The Act only enabled the Central Government to inspect the accounts of certain persons or associations. It did not provide for any power to audit the accounts of any organisation if it is considered necessary to do so. The Ordinance amended the Act by inserting a new section 15-A, to take specific power to audit the accounts of certain persons, organisations or associations, if the prescribed returns are not furnished in time by such persons, organisations or associations or the returns so furnished by them are not in accordance with law or their scrutiny gives room for suspicion that the provisions of the Act have been contravened.(v) A new section 25-A had also been inserted in the Act to provide that where any person is convicted of an offence relating to the acceptance or utilisation of foreign contribution for a second time, he shall be prohibited from accepting any foreign contribution for a period of three years from the date of the second conviction.2. The Bill seeks to replace the aforesaid Ordinance.[31st March, 1976]An Act to regulate the acceptance and utilisation of foreign contribution or foreign hospitality by certain persons or associations, with a view to ensuring that parliamentary institutions, political associations and academic and other voluntary organisations as well as individuals working in the important areas of national life may function in a manner consistent with the values of a sovereign democratic republic, and for matters connected therewith or incidental thereto.Be it enacted by Parliament in the Twenty-seventh Year of the Republic of India as follows:-| Brought into force on 5.8.1976 vide G.S.R. 755(E), dated 5.8.1976. |