SC refuses relief to NGOs that missed the FCRA registration cutoff
A three-judge bench headed by justice AM Khanwilkar refused to grant any interim relief and ordered the petition to be heard after pronouncement of judgment on the FCRA amendments.
The Supreme Court on Tuesday refused to grant any protection to NGOs that failed to renew their registration with the Foreign Contribution Regulation Authority (FCRA) by the deadline of December 31.
Representing the cause of about 6,000 NGOs that failed to renew their FCRA registration, a petition filed by US-based organisation Global Peace Initiative and its founder KA Paul challenged a December 31 notification issued by the home ministry that extended the registration of only those NGOs that had applied within the cutoff date.
Most of the NGOs were aggrieved by a new set of regulations introduced by the Centre through amendments in the FCRA Act in September 2020. These amendments required NGOs to disclose the purpose for receiving funds and to open bank accounts with the State Bank of India, which alone could receive foreign funds.
Transfer of funds from a registered NGO to an unregistered NGO was barred, as was diverting funds for purposes other than those specified during registration. The new rules also put a cap on administrative expenses.
These amendments are under challenge before the Supreme Court, which reserved judgment on a bunch of petitions in November last year. Citing the ongoing Covid-19 pandemic, the current petition sought an extension of existing FCRA registrations, citing the good work being done by NGOs during the pandemic.
A three-judge bench headed by justice AM Khanwilkar refused to grant any interim relief and ordered the petition to be heard after pronouncement of judgment on the FCRA amendments. The bench said, “If these NGOs have not applied for registration, they have chosen not to continue under the current regime.”
Solicitor General Tushar Mehta, appearing for Centre, opposed the petition and questioned the locus of the petitioner being an organization registered in Texas, US. He informed the court that the Centre had extended the provisional registration of about 11,594 NGOs which applied within the deadline, till March 2022 pending the judgment by the court.
The bench, also comprising justices Dinesh Maheshwari and CT Ravikumar, recorded the submission of Mehta and said, “We have heard the counsel on the matter of granting interim relief….In the light of the stand taken by the authorities, we do not intend to pass any interim order.”
Senior advocate Sanjay Hedge, appearing for the petitioner, told the court that since the extension has been granted to those NGOs which applied within cut-off, the government could provide a window of two weeks to enable the 6,000 NGOs to seek an extension. The bench said, “We will say the matter can wait till judgment. “
However, the Court observed that it will be open to the petitioner to submit a representation in this regard to the government.
The petition cited Section 50 of the FCRA Act, which empowers the government to extend the validity of registration of organizations. Such orders were passed by the Centre in favour of certain organizations during the peak of the second wave of Covid-19. The petition argued that similar exigency still exists.
