Why no tool to track NGO funds, asks Supreme Court

A threejudge bench, headed by Chief Justice of India (CJI) Jagdish Singh Khehar, passed the direction after hearing in detail arguments from one of the petitioners, Manohar Lal Sharma and Attorney General Mukul Rohatgi.

April 5 was set for the next hearing. It was argued by the petitioner, Sharma, that out of a total of 32 lakh Non-Governmental Organisations approximately, only 3 lakh filed their balance sheets. 

The Apex Court made it clear that those NGOs who did not file their balance sheets and misused the public funds and used it for other purposes would have to face action, including civil and criminal prosecution. It directed the Central government to take action in this regard against those NGOs. During the day while hearing the matter, the Apex Court had pulled up the Centre for not putting a proper mechanism in place to monitor funding of NGOs. The top court directed Secretary of Ministry of Rural Development to submit records in it by 2pm on Tuesday. 

The Supreme Court had summoned the Director of Council for Advancement of People’s Action and Rural Technology (CAPART) to be present at 2pm. CBI, in its reply, told the Apex Court that records showed that only 2,90,787 NGOs file annual financial statements of a total of 29,99,623 registered ones under the Societies Registra tion Act. To this, the Apex Court told the Central government that it must have a mechanism to audit and monitor how public funds are being used by the NGOs. It was not possible that the government releases huge amount of money every year and there is no record, the Apex Court said. 

It may be recalled that, in December last year, licences of around 20,000 NGOs have been cancelled by the government after they were found to be allegedly violating various provisions of the Foreign Contribution Regulation Act, thus barring them from receiving foreign funds.