FCRA Amendment Bill 2026 introduced in Parliament this month has proposed following changes:
1. The word Key functionary clearly defined: Key functionary includes a Director of a section 8 company, partner of a firm, trustee of trust, karta of HUF, an office bearer, member of the governing body, managing committee or other controlling authority of a society, trust, trade union or association of individuals and any other officer or person, by whatever name called, who has control over or responsibility for the management or affairs of such person
2. Vesting of unutilized FC and assets in Designated Authority: Unutilized FC and assets created using FC funds for a person whose FCRA certificate is cancelled or surrendered or has ceased shall vest provisionally with the Designated authority. The complete asset shall be vested even if FC was partly applied to acquire such assets with exceptions. The Designated Authority will take possession of assets through the Administrator. If the organization is not able to get fresh registration or renewal or get revision order under Section 32 within prescribed period, the FC and assets will be permanently vested. The FC and assets permanently vested will be applied by Designated Authority for public purposes and could be either transferred to Ministry/Department of Central or State Govt or disposed off and proceeds credited to Consolidated Fund of India. Further, if an organization ceases to exit, unutilized FC and assets will get vested with Designated Authority due to such cessation.
3. Reduction in punishment for contravention of FCRA: Reduced from 5 years to 1 year.
Implications of above proposed amendments :
Point 1: Interpretation and coverage of ‘key functionary’ has been spelt out clearly to be complied with for annual reporting, making changes and approval and for obtaining registration, renewal et c.
Point 2: Detailed procedure for vesting of unutilized FC and assets procured through FC due to cancellation/surrender/cessation laid down and relevant authorities specif ied
Point 3: punishment provision made reason able
The Amendment Bill below for reference.
CS Sharad Bhargava
FCRA Bill-March 2026.pdf (805.2 KB)