Section 7 of FCRA, 2010 states that the FC funds could be transferred or sub granted to another organization which is registered or is having prior permission under FCRA till 29.09.2020.
However the current FCRA Amendment Act, 2020 states that transferring and sub granting options would not be available to a FCRA registered organizations. In other words, FC registered organizations would not be entitled to transfer or sub grant any of the FC funds to any organization whether registered or unregistered under FCRA.
As per the Amendment the existing funds collected on behalf of other institutions cannot be transferred to such organisations. Such organisation have to apply the funds directly for charitable/religious purposes. .
It should be noted that any transfers made to FCRA registered organizations need to be disclosed in the online annual returns in Form FC-4. Details such as Name of the association, amount and date needs to be disclosed in the appropriate space provided in FC-4. Therefore, the donor organization should be recording such transfers in a way, where such records can be easily retrievable for reporting purposes to the FCRA in the annual returns.