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Section 25 FCRA 2010: Seizure of Article, Currency or Security

Section 25 of the Foreign Contribution (Regulation) Act, 2010 deals with the power to seize an article, currency or security where an authorised gazetted officer has reason to believe that it is connected with a contravention of the Act.

At a glance:

Section 25 is a seizure provision. It identifies who may exercise the power, the belief that must exist before seizure, and the property that may be seized. The later provisions of the Act deal with disposal, the procedure governing seizure and possible confiscation.

Text and meaning of Section 25

Section 25 - Seizure of article or currency or security received in contravention of the Act.

In substance, the provision authorises a gazetted officer who has been authorised by the Central Government, by a general or special order, to seize an article above the prescribed value, or Indian or foreign currency or security, when the officer has reason to believe that a provision of the FCRA has been or is being contravened in relation to that property.

The statutory provision should be read with the official India Code database and the Ministry of Home Affairs FCRA portal for the current Act, Rules, amendments, notifications and online FCRA services.

Conditions for seizure under Section 25

The power under Section 25 is not expressed as a general power available to every officer. The provision contains several elements that should be considered together:

  • Authorised gazetted officer: the officer must be a gazetted officer authorised for this purpose by the Central Government through a general or special order.
  • Reason to believe: the officer must have reason to believe that the relevant property is connected with a contravention of the FCRA.
  • Possession or control: the article, currency or security must be in the possession or control of a person.
  • Covered property: Section 25 extends to the qualifying article referred to in Section 2(1)(h)(i), and to currency or security, whether Indian or foreign.
  • Connection with contravention: a provision of the FCRA must have been contravened, or be in the process of being contravened, in relation to the article, currency or security.

Meaning of article under Section 2(1)(h)

Section 25 refers back to Section 2(1)(h)(i), which forms part of the definition of foreign contribution. In relation to an article, the Act excludes a gift for personal use when its market value in India on the date of the gift does not exceed the amount specified by the Central Government through the Rules.

Rule 6A of the Foreign Contribution (Regulation) Rules, 2011 currently provides a limit of one lakh rupees for an article gifted to a person for personal use. The limit was increased from twenty-five thousand rupees to one lakh rupees by the Foreign Contribution (Regulation) (Second Amendment) Rules, 2019.

Currency and security

Section 25 expressly covers currency or security whether Indian or foreign. Section 2(1)(h) treats donation, delivery or transfer of Indian or foreign currency by a foreign source as foreign contribution, subject to the Act. It also covers a security as defined under the Securities Contracts (Regulation) Act, 1956 and includes a foreign security as defined under the Foreign Exchange Management Act, 1999.

What happens after seizure?

Section 25 should be read with the connected provisions that follow it. These provisions establish the statutory sequence after a seizure:

  • Section 26 deals with disposal and handling of seized articles, currency or securities, including inventory and reporting requirements.
  • Section 27 provides the procedural rule applicable to seizures under the Act.
  • Section 28 provides for liability to confiscation where the seized property is adjudged to have been received or obtained in contravention of the FCRA.
  • Section 29 deals with adjudication of confiscation.
  • Section 30 deals with the procedure for confiscation.

Seizure and confiscation are different stages

Section 25 concerns seizure. Confiscation is dealt with separately in Sections 28 to 30. A seizure under Section 25 therefore should not be described as if it were, by itself, a final order of confiscation.

Practical reading of Section 25

For compliance and legal analysis, the important questions are whether the officer is duly authorised, whether the statutory basis for the officer's reason to believe exists, whether the property falls within the categories covered by Section 25, and whether the alleged FCRA contravention is connected with that property. The subsequent statutory procedure should then be examined under Sections 26 to 30.

Official FCRA resources

FCRA law has been amended from time to time. For current forms, rules, notifications and portal procedures, readers should verify the latest material published by the Government of India. The official resources include the FCRA Online Services portal, the Ministry of Home Affairs Foreigners-II Division and India Code.

Note: This page explains the statutory provision for general legal information. For a specific seizure, notice, investigation or confiscation proceeding, the applicable order, notification, facts and current law should be examined separately.