The Karnataka High Court.
Credit: DH File Photo
Having permanent registration under the Foreign Contribution (Regulation) Act (FCRA), 2010, is not sufficient ground for any organisation or NGO to get money credited to their designated savings bank account, the Karnataka High Court has ruled.
Dismissing a petition by the Bengaluru-based non-profit organisation, Manasa Centre for Development and Social Action, Justice KS Hemalekha said entities should also have clearance from the Ministry of Home Affairs for them to have the money. The Bengaluru-based organisation works in the domain of human rights.
The petition, filed in 2014, sought directions to the Development Credit Bank (DCB) to consider their representation submitted in August 2013 and release Rs 29,12,891, that was kept aside.
The petitioner had claimed that the amounts they received from "Dan Church Aid" were already utilised properly for various programmes, clarifying that the amount DCB had kept aside was not from Denmark-based NGO, "Dan Church Aid".
Besides seeking interest on the amount that has been kept aside, the petitioner had also sought Rs 10 lakh in damages.
The DCB, on its part, insisted that clearance from the Ministry of Home Affairs was necessary and such amounts could not be automatically credited to the account merely on the basis of permanent registration under FCRA.
From its side, the Union government presented a communication from the Director (Monitoring Unit), Foreigners Division (FCRA Wing), Ministry of Home Affairs, stating that “Dan Church Aid” had been placed under the 'Prior Reference/Permission Category', based on feedback/inputs of field/security agencies.
The government had also communicated to the Reserve Bank of India (RBI) to instruct all banks and their branches to notify the ministry for clearance about funds flowing into Indian individuals/entities from “Dan Church Aid” before crediting the amount to the accounts of recipient NGOs or associations.
Justice Hemalekha noted that a letter from the MHA, dated October 31, 2013, had clearly instructed DCB not to credit the amount received from “Dan Church Aid” to the petitioner’s account till further instructions.
"The object of the FCRA, 2010, is to consolidate the law to regulate the acceptance and utilisation of foreign contributions or foreign hospitality by certain individuals or associations or companies and to prohibit acceptance and utilisation of foreign contributions or foreign hospitality for any activities detrimental to national interest and for matters connected therewith or incidental thereto,” the court said.