Applied example
A society pays the ordered compounding amount through SBI Branch Payment but leaves vendor and salary instructions frozen; the public notice does not restore ordinary spending power.
NGO, FCRA and tax control
Payment of compounding fees from an expired-registration FCRA account - 14 May 2025
An association whose registration has expired may use the specified SBI Branch Payment feature to pay compounding penalty or fee from its FCRA Account. The relaxation is narrow: it does not authorise other receipt or utilisation while registration remains expired.
Controlling law and exact effect
Authority: MHA Public Notice No. II/21022/58(10)/12/2025-FCRA(MU), dated 14 May 2025
Provision and paragraph decode
| Control | What to establish |
|---|---|
| Trigger | an expired-registration association must pay a compounding amount or fee through the FCRA portal |
| Evidence pack | expiry and renewal status, compounding communication, portal challan, SBI debit, approval trail and proof that no other utilisation occurred |
| Timing | use the feature only for the notified payment and within the period/order governing the compounding matter |
| Legal result | An association whose registration has expired may use the specified SBI Branch Payment feature to pay compounding penalty or fee from its FCRA Account. The relaxation is narrow: it does not authorise other receipt or utilisation while registration remains expired. |
Working workflow
- Substantiate.
Assemble expiry and renewal status, compounding communication, portal challan, SBI debit, approval trail and proof that no other utilisation occurred and reconcile it to books, bank records and prior filings. - Decide and close.
Apply use the feature only for the notified payment and within the period/order governing the compounding matter, obtain approval where required, preserve submission evidence and monitor the resulting restriction or next deadline.
Practical example and highlighted point
Do not miss
Exam and advisory case study
A trust has a facially complete document but one fact conflicts with MHA Public Notice No. II/21022/58(10)/12/2025-FCRA(MU), dated 14 May 2025.
Finin2min summary and Q&A
Summary: An association whose registration has expired may use the specified SBI Branch Payment feature to pay compounding penalty or fee from its FCRA Account.
What should the audit file contain?
expiry and renewal status, compounding communication, portal challan, SBI debit, approval trail and proof that no other utilisation occurred, together with the legal conclusion, filing or payment proof and follow-up action.
Primary official sources and related links
Page-specific official source | FCRA Act, 2010 | FCRA portal
May 2025 FCRA Compounding Payment Relief
An association with expired FCRA registration can face a practical difficulty: penalties or compounding fees need paying while normal programme withdrawals are restricted. MHA’s May 2025 public notice addressed a narrow payment problem.
How the legal framework applies
MHA Public Notice No. II/21022/58(10)/12/2025-FCRA(MU), dated 14 May 2025, permits associations whose FCRA registration validity has expired to pay specified compounding penalties and fees from the SBI New Delhi Main Branch FCRA account through the FCRA online portal’s “SBI Branch Payment” facility. The notice explicitly says any other receipt or utilisation during this period violates the FCRA framework. This narrow facility must not be treated as restoration of registration, approval for supplier payments or automatic relief for cancellation and suspension cases.
Evidence, filings and practical controls
Create a payment file with the applicable compounding order, reference number, statutory amount, legal status of the registration, RBI/bank restrictions, evidence of the specified bank channel and downloaded acknowledgement. Obtain written approval from authorised governance officers. If portal instructions differ from the summary notice, hold the payment and resolve the discrepancy with MHA or counsel rather than routing it through an unauthorised account.
Worked scenario
An expired NGO owes ₹1 lakh under a compounding order. The finance manager should not simply release salary arrears or a vendor advance because the penalty can be paid. This concession concerns the specified statutory dues and cannot be stretched into a general operating account release.
Common mistakes to avoid
- Secure the signed MHA notice for case-specific reliance.
- Do not treat lapsed, suspended and cancelled certificates as identical.
- File the government fee receipt with the underlying order.
Frequently asked question
- Does paying a compounding fee restore FCRA registration?
- No; payment of a statutory liability is separate from registration, renewal or fresh approval.