SC seeks law to regulate NGO funds

The Centre has submitted new guidelines for accreditation of nearly 30 lakh NGOs and voluntary organisation in the country.

The Supreme Court on Wednesday suggested that the government ought to frame a statutory law to regulate the flow of public money to the NGOs even as Council for Advancement of People’s Action and Rural Technology (CAPART) recommended the registration of 159 FIRs against various NGOs for swindling government funds.

A three-judge Bench led by Chief Justice of India J.S. Khehar suggested introducing a law after perusing guidelines handed over by the government to the court, appointing NITI Aayog as the nodal agency for NGO registration.

But the court said the guidelines might not prove sufficient for “systematising the entire process of accreditation, fund utilisation and audit of NGOs”.

The Centre on April 4 handed over to the Supreme Court the new guidelines framed for accreditation of nearly 30 lakh NGOs and voluntary organisation in the country.

The Union Rural Development Ministry had framed the accreditation guidelines to regulate the “manner in which the VOs/NGOs, which are recipient of grants, would maintain their account, the procedure for audit of the account, including procedure to initiate action for recovering of the grants in case of misappropriation and criminal action”.

Black list

The court, however, gave the government the liberty to start civil and criminal proceedings against 703 NGOs, which according to CAPART, have defaulted. The agency, which works under the Rural Development Ministry, said 718 NGOs had been initially blacklisted, but 15 had responded satisfactorily to notices issued on them.

CBI records filed in 2016 in the Supreme Court had shown show that only 2,90,787 NGOs file annual financial statements of a total of 29,99,623 registered ones under the Societies Registration Act.

In some States, the CBI said the laws do not even provide for the NGOs to be transparent about their financial dealings. In the Union Territories, of a total of 82,250 NGOs registered and functioning, only 50 file their returns.

New Delhi has the highest number of registered NGOs among the Union Territories at 76,566. But none of these organisations submit returns, the CBI chart showed. In Kerala, which has 3,69,137 NGOs, there is no legal provision to submit returns. The same is the case for Punjab with 84,752 and Rajasthan with 1.3 lakh NGOs.

Uttar Pradesh, which has the highest number of NGOs at 5.48 lakh among 26 States, has only about 1.19 lakh filing returns. Tamil Nadu has about 1.55 lakh NGOs registered, however, only 20,277 file returns. Andhra Pradesh has 2.92 lakh NGOs, but only 186 file financial statements annually. West Bengal has 2.34 lakh registered NGOs, of which only 17,089 active NGOs file annual returns.

The Supreme Court had expanded the scope of Mr. Sharma’s PIL petition alleging misuse of funds by Anna Hazare’s NGO Hind Swaraj Trust to include the status of all NGOs.

Source: http://www.thehindu.com/news/national/sc-seeks-law-to-regulate-ngo-funds/article18219163.ece

India's top court asks government to consider making law to regulate NGOs

The Supreme Court asked the government to apprise it within eight weeks whether it is intended to continue with the present guidelines for NGOs or regulate NGOs through legislation.


India's top court, the Supreme Court of India, on Wednesday asked the government to consider making law to regulate NGOs as well as the funds given to them, saying that existing guidelines are not sufficient.

Observing that the present guidelines may not be systematic enough, the top court advised the government to give statutory status to the process of registration, accreditation and funding of NGOs.

The top court, which was hearing a Public Interest Litigation (PIL), asked the Centre to apprise it within eight weeks whether it intended to continue with the present guidelines or would likely to regulate the NGO through legislation.

Earlier Wednesday, the Council for Advancement of People's Action and Rural Technology (CAPART), told the court it had recommended registration of 159 FIRs against various NGOs for alleged misappropriation or misuse of funds disbursed to them.

CAPART, which disburses funds to voluntary organisations working in rural areas, said it had initially blacklisted 718 NGOs for not following the due process and not submitting their accounting details.

On January 10, the Supreme Court had said public money cannot go unaccounted for and those misappropriating must be prosecuted.

The court reprimanded the government for doling out crores of rupees to lakhs of NGOs, societies and voluntary organisations without being aware of the repercussion of non-auditing.

The bench had also warned that "mere blacklisting" of these organisations would not suffice and civil and criminal action should be initiated by CAPART/other government departments for misappropriating public money received by them from various government departments.

In September 2015, the Central Bureau of Investigation (CBI) informed the apex court that less than 10 per cent of over 30 lakh NGOs functioning across the country had submitted their returns or balance sheets and other financial details.


Source: https://www.wionews.com/south-asia/indias-top-court-asks-government-to-consider-making-law-to-regulate-ngos-14957

Enact law to regulate NGOs, SC tells govt

According to the draft, all NGOs/VOs are expected to register themselves on the NITI Aayog website, with NGO Darpan acting as a nodal agency

Months after ordering audits, the Supreme Court on Wednesday asked the Centre to explore enacting a law to regulate the government funds disbursed to the NGOs and prosecution in cases of misuse and misappropriation of funds, and non-filing of annual statements.

Expressing its unhappiness over the current regulations, the SC observed that the existing ones were insufficient to monitor lakhs of NGOs across the country.

"We get to know that Rs 950 crore is being given in total to all NGOs every year. This is a phenomenal amount... tax payers' money. Since 78 ministries and departments were granting money to NGOs, a law on regulating funds and work by NGOs would be much better. Inform us in eight weeks whether you want to streamline NGOs through guidelines or through legislation," a bench headed by Chief Justice JS Khehar told the government.

During the course of the hearing, the Council for Advancement of People's Action and Rural Technology (CAPART), a government agency under the aegis of the Ministry of Rural Development, said it had initially blacklisted 718 NGOs for not submitting accounting details. It had also recommended registration of 159 FIRs against various NGOs for misappropriation or misuse of funds disbursed to them.

On April 5, Additional Solicitor General Tushar Mehta submitted these guidelines in court and on direction from a bench, a copy which was given to Amicus Curiae Rakesh Dwivedi.

Apart from Dwivedi, all states and Union Territories have also been invited to pursue these guideline and give suggestions accordingly.

The order for the guidelines came on the heels of a petition filed by advocate ML Sharma, who submitted that NGOs should be regulated.

According to the draft, all NGOs/VOs are expected to register themselves on the NITI Aayog website, with NGO Darpan acting as a nodal agency. All requests for registration, accreditation and funds from the Union will be done through here.

Upon registration, each NGO will be provided a unique ID. The organisations would be subjected to the laws under Income Tax Act and the Foreign Contribution Regulations Act. The NGOs will be monitored and their past track record will be taken into account before any accreditation is granted. In the event no work is done, they money granted for that specific purpose will be refunded along with a 10 per cent interest. If funds are misappropriated, criminal investigations against key officials associated would be initiated and the NGO blacklisted.

The database would be maintained by NITI Aayog and information of the NGOs would be available on the website.

In its previous order, the SC had also directed a financial audit of all NGOs/VOs by March 31, 2017 to bring accountability in the public money disbursed to these NGOs. During the previous hearing, Dwivedi had cited a Central Bureau of Investigation (CBI) report which said there are more than 20 lakh NGOs receive funding from the Centre. However, only 10 per cent of them filed annual income and expenditure statements.

· The NGO-Partnership System (NGO-PS) Portal (NGO-DARPAN) maintained by the NITI Aayog invites all voluntary organisations, NGOs to sign up on the portal.

· VOs/NGOs get a system generated Unique ID, as and when they sign up.

· The Unique ID is mandatory to apply for grants under various governmental schemes.

· The portal facilitates creation of a repository of information about VOs/NGOs.

Source: http://www.dnaindia.com/india/report-enact-law-to-regulate-ngos-sc-tells-govt-2417550

Govt grants Rs 950 crore to NGOs, account it says SC The court also asked the Centre to examine enacting a law to regulate government funds for NGOs and prosecute them in cases of misuse or misappropriation of funds.

For the first time we have realised the phenomenal amount of money the government is giving to the Non-Governmental Organisations, the Supreme Court said on Wednesday. It was brought to the SC's light that the government gives NGOs Rs 950 crore every year.
The SC also asked the government to inform it within eight weeks whether it wants to streamline the NGOs through guidelines or a legislation. It is taxpayers' money and the NGOs and voluntary organisations must be held accountable for the same, the SC also observed. The SC also asked the government to inform it within eight weeks whether it wants to streamline the NGOs through guidelines or a legislation.
The SC said that since 78 ministries and departments were granting money to NGOs, a law on regulating funds and work by the NGOs would be much better. The court also asked the Centre to examine enacting a law to regulate government funds for NGOs and prosecute them in cases of misuse or misappropriation of funds. OneIndia News

Source: http://www.oneindia.com/india/govt-grants-rs-950-crore-to-ngos-account-it-says-sc-2417205.html

Supreme Court to Centre: Make a law to regulate NGOs, disbursal of funds

The apex court asked Centre to examine enacting a law to regulate government funds for NGOs and prosecute them in case of misuse, misappropriation of funds or non-filing of annual statements.

HIGHLIGHTS

· 1

Nearly 30 lakh NGOs across the country came under the Supreme Court's scrutiny on Tuesday.

· 2

The apex court asked Centre to examine enacting a law to regulate government funds for NGOs

· 3

Between 2002 and 2009, the Union and state governments released Rs 6,654 crore to various NGOs.

Nearly 30 lakh NGOs across the country - most of which receive funds worth crores of rupees from the government and abroad - came under the Supreme Court's scrutiny on Tuesday.

The apex court asked Centre to examine enacting a law to regulate government funds for NGOs and prosecute them in case of misuse, misappropriation of funds or non-filing of annual statements.

This was after a CBI report filed in the Supreme Court said only 10 per cent of 30 lakh NGOs have filed annual income and expenditure statements.

Between 2002 and 2009, the Union and state governments released Rs 6,654 crore to various NGOs, averaging almost Rs 950 crore per year, according to information received through RTI queries by Asian Centre for Human Rights, amicus curiae (senior lawyer assisting the court) Rakesh Dwivedi said, quoting the report. The Centre has been asked to file its response within eight weeks.

NEED OF MORE REGULATION

A bench, headed by CJI JS Khehar, said the existing regulations were not sufficient to "regulate the NGOs across the country, the disbursal of funds and consequential defaults".

Earlier in the day, Council for Advancement of People's Action and Rural Technology (CAPART) said it had recommended registration of 159 FIRs against various NGOs for alleged misappropriation or misuse of funds disbursed to them. The CAPART which works under the ministry of rural development and disburses funds to voluntary organisations working in rural areas, said initially, it had blacklisted 718 NGOs for not following the due process and not submitting their accounting details.SHOW CAUSE NOTICE

Under fire from the SC for not doing enough to rein in NGOs and voluntary organisations not filing annual statements and indulging in other irregularities, the Centre drafted guidelines saying the errant NGOs will be blacklisted.

"A show-cause notice is to be issued to the NGO with a direction to take corrective action immediately in case of non-submission of utilisation certificate or where the ministry/department suspects a material irregularity, or misutilisation misappropriation or falsification. In case of continued noncompliance, the NGO or voluntary organisation will be blacklisted, said the guidelines.

Passing detailed orders on the PIL by Advocate ML Sharma in 2011 seeking a tab on functioning of NGOs, the bench said mere blacklisting of NGOs who do not file annual statements will not suffice but also action must be initiated like criminal proceedings for misappropriation and civil action for recovery of given funds.

Source: http://indiatoday.intoday.in/story/supreme-court-ngos-regulation-centre/1/939415.html

Explore law for NGOs’ fund usage: SC to Centre

HIGHLIGHTS

· NGOs and voluntary organisations must give audited accounts of utilisation of central funds, SC said

· After all, it is taxpayers' money, the bench said

· Now NGO's will claim victim hood. Call gov dictatorial. Sickulars won't be happy .

NEW DELHI: Determined to fix accountability for lakhs of NGOs that received government grants of more than Rs 6,600 crore between 2002 and 2009, the Supreme Court asked the Centre on Wednesday to explore the desirability of a new law to regulate fund utilisation by the bodies.

"Whatever be the method, we are clear that NGOs and voluntary organisations must give audited accounts of utilisation of funds received from governments. After all, it is taxpayers' money," a bench of Chief Justice J S Khehar and Justices D Y Chandrachud and Sanjay Kishan Kaul said.

Pursuant to the SC's January 10 order to audit the accounts of all 35 lakh NGOs, of which less than 10% file their audited accounts regularly, the government had framed guidelines requiring NGOs and voluntary organisations to register with Niti Aayogfor accreditation to receive public funds.

The guidelines also proposed that NGOs must furnish a bond equivalent to the grant given to them, which would be encashed by the government if funds were misused or misappropriated.

On Wednesday, the bench saw merit in the suggestion of amicus curiae Rakesh Dwivedi, who said it would be better to provide a statutory framework to regulate funding of NGOs and their audit rather than administrative guidelines as proposed by the Centre.

Surprisingly, for such an important matter, not a single law officer from the Centre was present during the hearing that lasted for more than two hours.


"The Centre's counsel, P K Dey, will obtain instruction and inform the court whether the government of India would like to regulate the issue by finalising the guidelines or would like to regulate it through legislative measures," the bench said, giving the government eight weeks.

The bench asked the government not to relent and tell NGOs to account for the funds they had received for years. "Needless to mention that this order should not be treated as any restraint on the ongoing consideration of civil and criminal action against defaulting parties as contained in the affidavit filed by Capart," it said.

The government's proposal to require each NGO/VO to register with Niti Aayog did not impress the court, which said the aayog should be left to deal with important policy matters.


It also did not favour bringing NGOs under the lokpal or lokayukta and said if that was done then these two bodies would not be able to focus on corruption by persons in high positions. More than three years ago, the SC had asked CBI to undertake the NGO fund monitoring exercise on a PIL filed by advocate M L Sharma, who had accused Anna Hazare's NGO of misappropriating funds allotted by Council for Advancement of People's Action and Rural Technology (Capart).

Source: http://timesofindia.indiatimes.com/india/explore-law-for-ngos-fund-usage-sc-to-centre/articleshow/58389526.cms

Enact a law to regulate NGOs, Supreme Court tells Centre

The NGOs will only be granted accreditation after evaluating their internal governance and ethical standards.

New Delhi: Observing that a strict statutory framework is necessary to regulate government funding to NGOs, the Supreme Court on Wednesday asked the Centre to consider enacting a law to ensure regulation and accountability of over 30 lakh NGOs.

A three-judge bench of Chief Justice J.S. Khehar and Justices D.Y. Chandrachud and Sanjay Kishan Kaul told the counsel for the Centre that the existing regulations were not sufficient to regulate the NGOs across the country not only for effective disbursal of funds but also to take action for non-compliance of law.

In a brief order, the bench said, “The petition relates to money given to NGOs but there is no law to regulate them. The guidelines proposed by the Centre are not enough. We would like the govt to consider and examine in eight weeks the desirability of giving statutory status to the entire process.”

The CJI pointed out that each year, government departments disburse funds to the tune of `950crore to the NGOs and this has been going on for years. There seems to be no assessment of what happens to these funds — whether they are properly being utilised or not. Since this is government money, we want to know how many NGOs have been blacklisted and how many NGOs have been prosecuted. If the guidelines suggested by the government is given statutory status it will have some effect.”

Amicus curiae Rakesh Diwedi informed the court that during 2002 to 2009, the Centre through Council for Advancement of People’s Action and Rural Technology (Capart) had disbursed Rs 4,756 crore to the NGOs and voluntary organisations. During the same period, states had given Rs 1,897 crore to NGOs. And, on an average Rs 950 crore are given to NGOs by the Centre and states each year. He said recommendations have been made for de-listing 15 voluntary organisations and criminal prosecution have been initiated against 159 voluntary organisations for defaults or misappropriation.

In the guidelines, the Centre said it has proposed stringent guidelines for the NGOs, requiring them to register afresh online with Niti Aayog. They will be provided a unique ID and subjected to the Income Tax Act and Foreign Contribution Regulations act. The NGOs must give details of the audited account, I-T returns, area of operation and names of key personnel, the guidelines says.

The NGOs will only be granted accreditation after evaluating their internal governance and ethical standards. The past record of the NGOs too will be put under scrutiny before accreditation. The accredited NGOs will be subject to three-tier scrutiny to evaluate the funds utilised.

The scrutiny would also include the quality of work, the guidelines also state the NGOs and VOs getting govt funds are required to execute a bond to refund the amount with 10% interest if work not done. Misappropriation of funds would warrant registration of criminal case against NGOs/VOs and signatories will be jointly and severally responsible to refund the amount.

If the government is not satisfiecd with the progress of the projects or considers that the guidelines have been vioalted, it reserves the right to termiante the grant in aid with immediate effect. The grant will be blacklisted if it was found that funds were received by suppressing facts and giving misleading information.

While Haryana had more than one lakh (1,00,611) NGOs, Punjab accounted for 84,752 such organisations. CBI has filed the report in response to an apex court order asking the agency to conduct a survey on the total number of NGOs in the country and go into their functioning to ascertain their financial irregularities. The states that had more than one lakh NGOs were Maharashtra (5.18), Uttar Pradesh (5.48), Kerala (3.69), West Bengal (2.34), Tamil Nadu (1.55), Andhra Pradesh (2.92) and Madhya Pradesh (1.36).

Source: http://www.asianage.com/india/all-india/270417/enact-a-law-to-regulate-ngos-supreme-court-tells-centre.html

SC calls for statutory regime to regulate NGOs, state funding

New Delhi, The Supreme Court on Wednesday asked the Centre to consider putting in place a statutory regime to regulate the registration, funding, compliance and audit of the NGOs getting state support.

A bench of Chief Justice Jagdish Singh Khehar, Justice D.Y. Chandrachud and Justice Sanjay Kishan Kaul asked the government to consider giving a statutory status to the entire process.

This legal regime might also envisage the civil and criminal action against the defaulting NGOs as deemed fit by the legislature.

Observing that the existing guidelines were not systematic, the court in its order also asked the Centre to tell whether it would opt for a statutory regime or continue with the present guidelines.

The apex court gave the Centre eight weeks' time to tell the court its stand.

However, it also made it clear that its order would not come in the way of any ongoing proceedings, including civil and criminal action against the NGOs.

The court order came on a PIL seeking to make NGOs accountable for the expenditure of the funds received from the government.

Source: http://www.moneylife.in/article/sc-calls-for-statutory-regime-to-regulate-ngos-state-funding/50369.html

Consider making law to regulate NGOs: SC to Centre

The court was of the view that guidelines prepared by the government may not be “truly systematic” and sufficient with regard to the entire process of accreditation and the manner of utilisation of funds and audit of the NGOs.

Stating that existing regulations were not enough, the Supreme Court on Wednesday asked the Centre to consider enacting a law to regulate NGOs and penalise them for swindling funds.

A bench led by Chief Justice of India J S Khehar sought a reply in eight weeks on “whether the government would like to regulate the issues in hand by finalising guidelines or would rather regulate the NGOs through legislative measures”.

The bench, also comprising Justices D Y Chandrachud and S K Kaul, added: “If the government desires to extend statutory status to the entire process, the requirement of the statute would not only formulate for future consequences but would also envisage civil and criminal actions, as may be considered appropriate by the legislature.”

The court was of the view that guidelines prepared by the government may not be “truly systematic” and sufficient with regard to the entire process of accreditation and the manner of utilisation of funds and audit of the NGOs.

The government had earlier submitted its guidelines, saying it appointed NITI Aayog as nodal agency for registration of NGOs. The guidelines included the procedure for execution of bond, termination of grant-in-aid, blacklisting of NGOs, recovery of the money by civil suit and subsequent criminal action in case of diversion or misappropriation of funds, among others.

The court, however, said the NITI Aayog could already be preoccupied with several other important works.

It also made it clear that its order would not be considered as restraint on the government from initiating civil and criminal actions against as many as 703 NGOs which the Council for Advancement of People’s Action and Rural Technology (CAPART) under the Ministry of Rural Development has identified as defaulting.

In an affidavit filed in response to a PIL by Delhi lawyer M L Sharma, CAPART said it had recommended registration of 159 FIRs against various NGOs for alleged misappropriation or misuse of funds disbursed to them.

Source: http://indianexpress.com/article/india/consider-making-law-to-regulate-ngos-supreme-court-to-centre-4629684/

SC seeks law to regulate NGO funds

The Centre has submitted new guidelines for accreditation of nearly 30 lakh NGOs and voluntary organisation in the country.

The Supreme Court on Wednesday suggested that the government ought to frame a statutory law to regulate the flow of public money to the NGOs even as Council for Advancement of People’s Action and Rural Technology (CAPART) recommended the registration of 159 FIRs against various NGOs for swindling government funds.

A three-judge Bench led by Chief Justice of India J.S. Khehar suggested introducing a law after perusing guidelines handed over by the government to the court, appointing NITI Aayog as the nodal agency for NGO registration.

But the court said the guidelines might not prove sufficient for “systematising the entire process of accreditation, fund utilisation and audit of NGOs”.

The Centre on April 4 handed over to the Supreme Court the new guidelines framed for accreditation of nearly 30 lakh NGOs and voluntary organisation in the country.

The Union Rural Development Ministry had framed the accreditation guidelines to regulate the “manner in which the VOs/NGOs, which are recipient of grants, would maintain their account, the procedure for audit of the account, including procedure to initiate action for recovering of the grants in case of misappropriation and criminal action”.

Black list

The court, however, gave the government the liberty to start civil and criminal proceedings against 703 NGOs, which according to CAPART, have defaulted. The agency, which works under the Rural Development Ministry, said 718 NGOs had been initially blacklisted, but 15 had responded satisfactorily to notices issued on them.

CBI records filed in 2016 in the Supreme Court had shown show that only 2,90,787 NGOs file annual financial statements of a total of 29,99,623 registered ones under the Societies Registration Act.

In some States, the CBI said the laws do not even provide for the NGOs to be transparent about their financial dealings. In the Union Territories, of a total of 82,250 NGOs registered and functioning, only 50 file their returns.

New Delhi has the highest number of registered NGOs among the Union Territories at 76,566. But none of these organisations submit returns, the CBI chart showed. In Kerala, which has 3,69,137 NGOs, there is no legal provision to submit returns. The same is the case for Punjab with 84,752 and Rajasthan with 1.3 lakh NGOs.

Uttar Pradesh, which has the highest number of NGOs at 5.48 lakh among 26 States, has only about 1.19 lakh filing returns. Tamil Nadu has about 1.55 lakh NGOs registered, however, only 20,277 file returns. Andhra Pradesh has 2.92 lakh NGOs, but only 186 file financial statements annually. West Bengal has 2.34 lakh registered NGOs, of which only 17,089 active NGOs file annual returns.

The Supreme Court had expanded the scope of Mr. Sharma’s PIL petition alleging misuse of funds by Anna Hazare’s NGO Hind Swaraj Trust to include the status of all NGOs.

Source: http://www.thehindu.com/news/national/sc-seeks-law-to-regulate-ngo-funds/article18219163.ece