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CS Executive · Economic, Commercial and Intellectual Property Laws · Law relating to Foreign Contribution Regulation

Hope Foundation's FCRA certificate was cancelled under Section 14. It holds unspent foreign contribution and assets bought from it. Which statement is correct under Section 15?

On cancellation of the certificate, the foreign contribution and assets created from it vest in the prescribed authority. That authority may, if it considers it necessary and in public interest, manage the person's activities as directed by the Central Government. The funds do not stay with trustees or return to donors.

  1. AThe funds and assets vest in the authority as may be prescribed, which may manage its activities if it considers necessary and in public interestCorrect
  2. BThe funds stay with the Foundation's trustees, who must spend them within six months
  3. CThe funds and assets are automatically returned to the foreign donor
  4. DThe assets must be sold by the Foundation under a court order before vesting

Explanation

Under Section 15(1) the foreign contribution and assets created from it vest in the prescribed authority. Section 15(2) lets that authority manage the activities if necessary and in public interest, and it can use the funds or dispose of assets if funds are inadequate. Section 15(3) provides for return if the person is later registered, not for return to donors.

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