NGOs with no connection to political parties can’t be denied access to foreign contributions for supporting public causes

Supreme Court: The bench of L. Nageswara Rao and Deepak Gupta, JJ has held that the support to public causes by resorting to legitimate means of dissent like bandh, hartal etc. cannot deprive an organisation of its legitimate right of receiving foreign contribution. It said,

Refusing to declare Sections 5 (1) and 5 (4) of the Foreign Contribution (Regulation) Act, 2010 and Rules 3 (i), 3 (v) and 3 (vi) of the Foreign Contribution (Regulation) Rules, 2011 violative of Articles 14, 19 (1) (a), 19 (1) (c) and 21 of the Constitution of India, the bench said,

“It is clear from the provision itself that bandh, hartal, rasta roko etc., are treated as common methods of political action. Any organisation which supports the cause of a group of citizens agitating for their rights without a political goal or objective cannot be penalized by being declared as an organisation of a political nature.”

The Court explained that the purpose for which the statute prevents organisations of a political nature from receiving foreign funds is to ensure that the administration is not influenced by foreign funds. Prohibition from receiving foreign aid, either directly or indirectly, by those who are involved in active politics is to ensure that the values of a sovereign democratic republic are protected.

It, however, added that such of those voluntary organisations which have absolutely no connection with either party politics or active politics cannot be denied access to foreign contributions. Therefore, such of those organisations which are working for the social and economic welfare of the society cannot be brought within the purview of the Act or the Rules by enlarging the scope of the term ‘political interests’.

Hence, stating that it is only those organisations which have connection with active politics or take part in party politics, that are covered by Rule 3 (vi), the Court held,

“Any organisation which habitually engages itself in or employs common methods of political action like ‘bandh’ or ‘hartal’, ‘rasta roko’, ‘rail roko’ or ‘jail bharo’ in support of public causes can also be declared as an organisation of political nature, according to the guideline prescribed in Rule 3 (vi).”

[Indian Social Action Forum v. Union of India, Civil Appeal No.1510 of 2020, decided on 06.03.2020]

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