Is donation from Indian passport holder’s foreign bank account domestic or foreign?

General
1

Dear Sir Madam,

I am Sharada from Buzz India Trust.

I need some clarification on the individual donation.

One donor, having an Indian passport, is willing to donate to us. He had a Foreign bank account. Please let us know whether this will be considered as “Domestic” donations or “Foreign” donations?

Please guide us and do the needful.

2

This will be considered a foreign donation.

Under India’s Foreign Contribution (Regulation) Act, 2010 (FCRA), the key factor is the source of the money, not the citizenship of the donor.

Since your donor is using a foreign bank account, the donation falls under the regulations of the FCRA. To accept this donation, your organization must have a valid FCRA registration certificate and receive the funds only in your designated FCRA bank account.

3

Dear All, I have a different take on this. The source is considered for determining the character of money. Since the donor has Indian Passport, he is an Indian citizen and hence funds donated by him/her are domestic funds. In case of NRIs also the funds are remitted from foreign bank but since the NRI is Indian passport holder, the money is treated as domestic.

Similarly if a individual has acquired foreign citizenship (does not have Indian passport), the money transferred from the Indian bank account will be treated as Foreign

4

I rechecked the FCRA’s FAQ and yes you are correct @141274.

The official answer provided by the MHA is:

“Contributions made by a citizen of India living in another country (i.e., Non-Resident Indian), from his personal savings, through the normal banking channels, is not treated as foreign contribution. However, while accepting any donations from such NRI, it is advisable to obtain his/her passport details to ascertain that he/she is actually an Indian citizen.”

Sorry for the confusion!

5

Just to clarify, NRI is domestic source but an Overseas Citizen of India holding OCI card and a Person of Indian Origin holding foreign passport is a foreign source.

Please also read the latest FAQ on FCRA issued by MHA available on fcraonline.nic.in.

CS Sharad Bhargava

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