The Ministry of Home Affairs (MHA) has relaxed certain rules of the Foreign Contribution (Regulation) Act, 2011, which among other things, gives concessions to politicians, bureaucrats, and judges seeking hospitality on foreign junkets without government permission.

Now, the amended FCRA rules allow compounding of a public servant’s offence of availing unauthorised hospitality by paying just ₹10,000. Such an offence under Section 35 of the FCRA also invites prosecution which involves imprisonment for a term which may extend to five years, or with a fine, or with both.

The FCRA’s Section 6 clearly prohibits the acceptance of foreign hospitality. “No member of a legislature or office bearer of a political party or judge or government servant or employee of any corporation or any other body owned or controlled by government shall, while visiting any country or territory outside India, accept, with the prior permission of the central government any foreign hospitality”. Following this amendment coming into effect from July 1, the violation of the above section would be a compoundable offence.

Time limit for compliance

The overall amendments in the FCRA rules, through two notifications brought in the gazette by the MHA, have enhanced the scope of escaping prosecution by enlarging the ambit of compounding of some other offences as well. Other than making offences compoundable, the time limit for compliance has also been relaxed from 15 to 45 days and Rule 13, clause (b), which deals with placing details of funds received within a fortnight on the website, has been omitted.

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FCRA Amendments and ‘reasonable restrictions’

“Such matters are in the realm of public policy. Compounding of offences reduces litigation. This, however, would not bar disciplinary action which is equally deterrent against erring officers,” Gyanant Singh, Delhi high court lawyer, who handles criminal as well as service matters, told BusinessLine.

Compoundable offences

The new rules have listed designated officers, either an officer of the rank of director or deputy secretary, authorised to handle different categories of offences mentioned in the Act. Put together, 12 offences under the FCRA have been made compoundable through the latest amendments to rules, which also includes non-reporting of receiving of foreign funds, depositing of fund received from abroad in an account other than the one opened to receive currencies of other nations and not maintaining accounts and records as stipulated.   

To cite an example, for offences punishable under Section 37 of the Act, which deals with transferring foreign contribution to any other person in contravention of the FCRA, the altered rules offer compounding options too. The penalty would be ₹1 lakh or ten per cent of such transferred foreign contribution whichever is lighter, said the gazette notification. Similarly, for contravention of receiving foreign money in an account other than specified account, the compoundable penalty is ₹1 lakh or five per cent of remittance received in such account, whichever is higher, said the notification.  

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