Section 4 of The Foreign Contribution (Regulation) Act, 2010
Nothing contained in section 3 shall apply to the acceptance, by any person specified in that section, of any foreign contribution where such contribution is accepted by him, subject to the provisions of section 10,—
- (a)by way of salary, wages or other remuneration due to him or to any group of persons working under him, from any foreign source or by way of payment in the ordinary course of business transacted in India by such foreign source; or
- (b)by way of payment, in the course of international trade or commerce, or in the ordinary course of business transacted by him outside India; or
- (c)as an agent of a foreign source in relation to any transaction made by such foreign source with the Central Government or State Government; or
- (d)by way of a gift or presentation made to him as a member of any Indian delegation, provided that such gift or present was accepted in accordance with the rules made by the Central Government with regard to the acceptance or retention of such gift or presentation; or
- (e)from his relative; or
- (f)by way of remittance received, in the ordinary course of business through any official channel, post office, or any authorised person in foreign exchange under the Foreign Exchange Management Act, 1999 (42 of 1999); or
- (g)by way of any scholarship, stipend or any payment of like nature: Provided that in case any foreign contribution received by any person specified under section 3, for any of the purposes other than those specified under this section, such contribution shall be deemed to have been accepted in contravention of the provisions of section 3.
Summary
- This section provides specific exceptions to the strict bans on receiving foreign money established earlier in the law.
- It allows people who are normally banned from taking foreign funds to receive money if it is their rightful salary or wages from a foreign source.
- It permits these individuals to accept payments made during normal international trade or regular business transacted outside India.
- It lets them accept money if they are acting as an official agent of a foreign source doing a transaction with the Indian government.
- It allows them to receive gifts presented to them while they are acting as a member of an official Indian delegation, subject to certain rules.
- It permits them to receive money from their own relatives.
- It allows them to accept standard scholarships, stipends, or regular business remittances through official banking channels.
Practical examples
FAQ
1. Under Section 4 of the FCRA 2010, can a public servant accept money from a family member abroad?
Yes, under Section 4 of the FCRA 2010, the prohibition on accepting foreign money does not apply if the money is received from a relative.
2. Does Section 4 of the FCRA 2010 allow a politician to accept a foreign stipend?
Yes, Section 4 of the FCRA 2010 states that the normal ban does not apply to money received by way of any scholarship, stipend or any payment of like nature.
3. Under Section 4 of the foreign funding law, is earning a salary from a foreign company legal for someone otherwise banned?
Yes, Section 4 of the foreign funding law creates an exception for money received by way of salary, wages or other remuneration due to a person from a foreign source.
4. How does Section 4 of the FCRA 2010 handle business payments for journalists?
Section 4 of the FCRA 2010 allows anyone, including journalists, to receive payment in the course of international trade or in the ordinary course of business transacted outside India.
Test yourself
Q1.Combining the rules of Section 3 and Section 4 of the Foreign Contribution (Regulation) Act, 2010, which scenario is legally permitted for a Member of Parliament?
Q2.According to Section 4 of the FCRA 2010, an individual who is normally prohibited from accepting foreign money can legally accept a gift under which specific condition?
Q3.Under Section 4 of the FCRA 2010, which type of regular financial payment is allowed as an exception?
Q4.Based on Section 4 of the FCRA 2010, what happens if a banned person receives a foreign contribution for a reason NOT listed in the exceptions?