SC for proper law to regulate functioning, funding of NGOs

Satya Prakash

Tribune News Service

New Delhi, April 26 

The Supreme Court on Wednesday asked the NDA government to examine the feasibility of having a legislation to regulate functioning of over 32 lakh non-government organisations (NGOs), their funding and to take to task the defaulting ones.

After examining a set of guidelines prepared by the government, a bench headed by Chief Justice of India JS Khehar said the existing or proposed guidelines were not sufficient to deal with “unaccountable” NGOs getting grants from government agencies for decades.

The government had proposed that all NGOs receiving or desirous of receiving government funds have to mandatorily register themselves with the Niti Aayog or an agency notified by the Centre for registration and accreditation. It had submitted draft norms for their registration, accreditation, release of funds, monitoring, auditing of accounts, disciplinary procedures and dispute resolution.

“In future, all funds to NGOs/VOs (voluntary organisations) should be released through the Public Funds Management Systems (PFMS),” the Centre had said in its guidelines prescribing a three-tier monitoring of NGOs.

“You cannot expect Niti Aayog to start registering NGOs, keep a tab and take action. It’s just not possible,” the bench said expressing surprise over yearly disbursal of Rs 950 crore to NGOs.

“You cannot allow public funds to go waste. There is no assessment to what happened to all that money given to them (NGOs),” it commented.

The bench didn’t find the draft guidelines good enough to be accepted. “We are not happy with the guidelines. You must crystallise them. Those (NGOs) which are clear are clear. If not then blacklist and prosecute them,” it told the Centre.

The bench – which is seized of a PIL seeking proper guidelines to regulate over 32 lakh NGOs, many of which are not properly audited -- said the law should not only provide for enforceable consequences but also prescribe civil and criminal action. 

The court suggestion came after CAPART – a registered body under the Ministry of Rural Development – said it had initiated criminal proceedings against 159 voluntary organisations (VOs) for misappropriation of funds.

The CAPART said initially it had blacklisted 718 NGOs for not following the due process and not submitting their accounting details. Later, 15 NGOs were removed from the blacklist after they complied with the accounting norms, it submitted.

However, CAPART admitted that its infrastructure was insufficient to take a meaningful action in respect of money released to NGOs.

“Position placed on record by CAPART does not reveal the entire factual position since it is only one of the 76 ministries/agencies distributing funds,” the court noted.

The top court had on January 10 ordered the government to devise a proper mechanism to stop misuse of government funds given to NGOs and subject them to auditing.

“On the earlier occasion when we had passed the order we did not rightly perceive the magnitude of the funds involved and task contemplated,” it noted. 

Petitioner ML Sharma had alleged that 80 per cent of the NGOs received foreign funds and there are 30 lakh NGOs in the country and there was no legal framework to properly regulate them. Unless some mechanism is put in place centrally, nothing can be done.

Haryana and Punjab accounted for over 1 lakh and 84,752 NGOs, respectively. Many other states had much more NGOs. According to a report filed by the CBI, Maharashtra (5.18 lakh), Uttar Pradesh (5.48 lakh), Kerala (3.69 lakh), West Bengal (2.34 lakh), Tamil Nadu (1.55 lakh), Andhra Pradesh (2.92 lakh) and Madhya Pradesh (1.36 lakh) had much greater number of NGOs.