Section 2 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 2(1) defines a number of everyday words that carry a particular meaning in the Foreign Contribution (Regulation) Act, 2010: "association", "person", "political party", "Legislature", "candidate for election", "certificate", "relative" and others. Many of them borrow their meaning from other Acts, some of which have since been replaced.
This article states the clauses as per the Act as enacted, read with the Foreign Contribution (Regulation) Amendment Act, 2020 (33 of 2020), which did not change section 2. Later amendments should be checked. Where a clause cites an older law, it is quoted as printed and you should check the current law for the corresponding provision; no replacement Act or section is named here.
An "association" is an association of individuals, incorporated or not, having an office in India, and includes a society whether registered or not. A "person" includes an individual, a Hindu undivided family, an association and a company registered under section 25 of the Companies Act, 1956. A "political party" and a "Legislature" are defined at length, and the certificate is the certificate of registration granted under section 12(3).
The clauses that decide who is covered
Association, person and company
- Section 2(1)(a) "association" means an association of individuals, whether incorporated or not, having an office in India. It includes a society, whether registered under the Societies Registration Act, 1860 or not, and any other organisation, by whatever name called.
- Section 2(1)(m) "person" includes (i) an individual, (ii) a Hindu undivided family, (iii) an association and (iv) a company registered under section 25 of the Companies Act, 1956. The Act as enacted names the 1956 Act, so check the current law for the corresponding provision. Our post on section 8 of the Companies Act, 2013 for charitable companies covers that separate law.
- Section 2(1)(f) "company" has the meaning assigned to it in the Income-tax Act, 1961 (clause (17) of its section 2, as printed). See our income-tax guides for that law.
Because "person" includes an individual, a Hindu undivided family and an association, a trust, a society and a charitable company can all be a "person" under the Act. Our guide to society, trust and section 8 company compares the three forms, and the form you choose also decides what registration route you need. If you are choosing the legal form of an organisation that will receive foreign money, see our section 8 company registration service.
Example (invented). Dhanvantari Seva Samaj is an unregistered group of eleven people with an office in Nashik. It is an "association" because it is a group of individuals with an office in India; registration under the Societies Registration Act, 1860 is not a condition. A Hindu undivided family running a charitable dispensary is a "person" under clause (m)(ii).
Political party, candidate and Legislature
- Section 2(1)(n) "political party" means (i) an association or body of individual citizens of India that is (A) to be registered with the Election Commission of India as a political party under section 29A of the Representation of the People Act, 1951, or (B) one which has set up candidates for election to any Legislature but is not so registered or deemed to be registered under the Election Symbols (Reservation and Allotment) Order, 1968; or (ii) a political party mentioned in column 2 of Table 1 and Table 2 to the notification of the Election Commission of India No. 56/J&K/02 dated the 8th August, 2002, as in force for the time being.
- Section 2(1)(d) "candidate for election" means a person who has been duly nominated as a candidate for election to any Legislature.
- Section 2(1)(k) "Legislature" is set out in the table below.
| Limb | Legislature |
|---|---|
| (A) | Either House of Parliament |
| (B) | The Legislative Assembly of a State, or either House of the Legislature in a State with a Legislative Council |
| (C) | The Legislative Assembly of a Union territory constituted under the Government of Union Territories Act, 1963 |
| (D) | The Legislative Assembly for the National Capital Territory of Delhi referred to in the Government of National Capital Territory of Delhi Act, 1991 |
| (E) | A Municipality as defined in clause (e) of article 243P of the Constitution |
| (F) | District Councils and Regional Councils in the States of Assam, Meghalaya, Tripura and Mizoram as provided in the Sixth Schedule to the Constitution |
| (G) | A Panchayat as defined in clause (d) of article 243 of the Constitution |
| (H) | Any other elective body as may be notified by the Central Government |
Limb (E) and limb (G) show how wide the term is: a candidate in a municipal or panchayat election is a "candidate for election" and a member of such a body is a "member of any Legislature". Limb (H) rests on a notification, and no notification under it is described in this article. The prohibitions that use these terms are explained in section 3 on who cannot accept foreign contribution.
Bank, authorised person and scheduled bank
- Section 2(1)(b) "authorised person in foreign exchange" means an authorised person referred to in clause (c) of section 2 of the Foreign Exchange Management Act, 1999. Our post on authorised person under section 10 of the Foreign Exchange Management Act, 1999 covers that separate law.
- Section 2(1)(c) "bank" means a banking company as referred to in clause (c) of section 5 of the Banking Regulation Act, 1949.
- Section 2(1)(s) "scheduled bank" has the meaning assigned in clause (e) of section 2 of the Reserve Bank of India Act, 1934.
Certificate, notification, prescribed and prescribed authority
- Section 2(1)(e) "certificate" means the certificate of registration granted under section 12(3), explained in the article on section 12.
- Section 2(1)(l) "notification" means a notification published in the Official Gazette; "notify" is construed accordingly.
- Section 2(1)(o) "prescribed" means prescribed by rules made under the Act, and section 2(1)(p) "prescribed authority" means an authority specified as such by rules made by the Central Government. The name of the authority is not described in this article.
Newspaper, relative, subsidiary, associate and trade union
- Section 2(1)(q) "registered newspaper" means a newspaper registered under the Press and Registration of Books Act, 1867.
- Section 2(1)(r) "relative" has the meaning assigned in clause (41) of section 2 of the Companies Act, 1956. This matters for section 4, which excepts contribution accepted from a relative.
- Section 2(1)(t) "subsidiary" and "associate" have the meanings given in the Companies Act, 1956.
- Section 2(1)(u) "trade union" means a trade union registered under the Trade Unions Act, 1926.
Section 2(2): other Acts' definitions
Section 2(2) says words and expressions used in the Act and not defined in it, but defined in the Representation of the People Act, 1950, the Representation of the People Act, 1951 or the Foreign Exchange Management Act, 1999, have the meanings given in those Acts. Where the FCRA is silent on a word, look first at those three Acts.
Need help with the form of your organisation?
Whether the body that will receive foreign money is a society, a trust or a charitable company affects registration and reporting. If you are weighing the options, our section 8 company registration team can explain the choices before you decide.
Key takeaways
- "Association" covers incorporated and unincorporated groups with an office in India, including societies registered or not.
- "Person" includes an individual, a Hindu undivided family, an association and a company registered under section 25 of the Companies Act, 1956 as printed.
- "Political party" includes parties registered or to be registered with the Election Commission and unregistered bodies that have set up candidates.
- "Legislature" reaches Parliament, State and Union territory assemblies, municipalities, district and regional councils, panchayats and any elective body notified.
- Several clauses cite older Acts; check the current law for the corresponding provision.
Read next
- Section 2: foreign contribution and foreign hospitality
- Section 2: foreign source and foreign company
- Section 3: who cannot accept foreign contribution
- Section 4: persons to whom section 3 does not apply
Disclaimer: Based on the Foreign Contribution (Regulation) Act, 2010 as enacted, read with the Amendment Act, 2020 and the other amendments named in this article, and on the Foreign Contribution (Regulation) Rules, 2011 as amended by the notifications named (latest consulted: S.O. 3272(E) dated 22 June 2026), as consulted on 2 October 2026. No consolidated official text was available; some provisions rest on a third-party copy and are identified as such. Later amendments, notifications and Ministry of Home Affairs orders should be checked. This article is general information, not legal advice; check the official text before acting.