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CS Professional · CSR and Social Governance · Foreign Funding to Non-Corporate Entities

Navjyoti Foundation, an FCRA-registered society, received foreign contribution in its SBI New Delhi FCRA Account. Its secretary wants to move part of it into a savings account in a scheduled bank of the Foundation's choice, in the Foundation's own name, to pay project vendors. Which statement is correct?

The move is allowed. Section 17 lets the registered person transfer foreign contribution from its FCRA Account to one or more accounts in scheduled banks for utilisation. This is not a transfer to another person, but no funds other than foreign contribution may be deposited in those accounts.

  1. ANot allowed, because moving funds between accounts is a transfer barred by section 7
  2. BAllowed, as the Act permits transfer to one or more accounts of the same person in scheduled banks for utilisation, and only foreign contribution may be deposited thereCorrect
  3. CAllowed only if the second account also receives the Foundation's domestic donations
  4. DAllowed only after the Central Government approves each such transfer

Explanation

Section 17 provisos allow the person to open one or more accounts in scheduled banks to which foreign contribution is transferred for utilisation. This is movement among the holder's own accounts, not a transfer to another person under section 7. The last proviso forbids depositing any funds other than foreign contribution, so mixing domestic donations is wrong.

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