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

The certificate of Navjyoti Welfare Trust is cancelled under Section 14 of the FCRA. The Trust holds unspent foreign contribution and a building bought from it. What happens under Section 15?

The unspent foreign contribution and the assets created from it vest in the prescribed authority under Section 15. That authority must return them if the Trust is subsequently registered under the Act. The Trust cannot retain or redistribute them itself.

  1. AThe Trust may keep both until it applies again for registration
  2. BThe foreign contribution and assets created out of it vest in the prescribed authority, which must return them if the Trust is subsequently registered under the ActCorrect
  3. CThe assets are divided equally among the trustees
  4. DThe funds must be transferred to another registered NGO chosen by the Trust

Explanation

Section 15(1) vests the foreign contribution and assets created from it in the prescribed authority on cancellation. Section 15(3) requires return to the person if it is later registered. Trustees do not take them, and transfer to another NGO by the Trust is not provided.

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