Granting interim relief to Lawyers Collective, an NGO run by lawyer Indira Jaising that was barred by the Union government from receiving foreign funds, the Bombay High Court on Monday allowed the NGO to operate its domestic accounts, preventing the Charity Commissioner from disposing of the NGO’s assets until final hearing of the case.
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“It may not be proper to freeze practically all the bank accounts of the NGO and completely cripple its activities and functioning pending the final hearing in the matter,” said the HC.
The NGO had filed an application in court against the government’s decision.
The court observed that the Centre’s action against Lawyers Collective of cancelling its registration under the Foreign Contribution Regulation Act (FCRA) permanently, thereby barring the organisation from receiving foreign funds, was in excess of its jurisdiction. The allegations against the NGO were “vague” regarding the charge of mixing foreign contributions with local/domestic funds, it added.
The HC further held that the provisions of FCRA cannot be used to stifle the functioning and activities of individuals or associations, provided such activities and such functioning is not otherwise in breach of any legal provisions.
The Ministry of Home Affairs (MHA) in its order of November 27 last year alleged that there were discrepancies in foreign contributions cited by the association in its returns filed with the MHA. The order also stated that Jaising, who was the Additional Solicitor General under the UPA government, had violated FCRA norms by receiving foreign funds when she was a government servant.
The government had claimed that their action under Section 22 of FCRA was “appropriate”. The section deals with disposal of assets created out of foreign contribution.
“For any action under Section 22 of the FCRA, the authority has to be satisfied that the person who was permitted to accept foreign contribution under the Act, which would, in the present case, include an association like the appellants ceases to exist or has become defunct. There is absolutely no material on record to even suggest that the appellants have either ceased to exist or have become defunct,” observed Justice M S Sonak.
“Prima facie the direction for action is in excess of jurisdiction… Therefore, a case is made out for grant of interim relief,” he added.
The freeze order on the FCRA accounts will, however, not be disturbed.