No one has a fundamental right to receive foreign contributions-Supreme Court

A three-judge Bench of the Supreme Court led by Justice A.M. Khanwilkar on April 8 upheld the amendments introducing restrictions in the Foreign Contribution (Regulation) Act (FCRA), 2010.

• The bench said that no one has a fundamental or absolute right to receive foreign contributions.

• The court reasoned that unbridled inflow of foreign funds may destabilise the sovereignty of the nation.

• The petitioners, including individuals and NGOs engaged in cultural, educational, religious activities, argued that the amendments suffered from the “vice of ambiguity, over-breadth or over-governance” and violated their fundamental rights.

• They argued that the new regime amounts to a blanket ban on the capacity of intermediary organisations in India to distribute foreign donations to smaller and less visible NGOs.

• But the court countered that the amendments only provide a strict regulatory framework to moderate the inflow of foreign funds.

• The court said, ‘Free and uncontrolled inflow of foreign funds has the potential to impact the socio-economic structure and polity of the country.

• Permitting inflow of foreign contribution, which is a donation, is a matter of policy of the State backed by law, the top court held.

• It was open for the State to even have a regime which may completely prohibit receipt of foreign donation, as no right inheres in the citizen to receive foreign donations.

• The court also said, anyone wanting foreign contributions cannot be said to be engaged in “usual or ordinary business”.

FCRA amendments

• The restrictions-introduced by the amendment, involve a bar on using operational FCRA accounts to get foreign contributions and mandatory production of the Aadhaar card for registration under the FCRA.

• They require NGOs and recipients to open a new FCRA account at a specified branch of the State Bank of India in New Delhi as a “one-point entry” for foreign donations.

• Donations made by Non-Resident Indians (NRIs) are not considered as “foreign contribution” although a donation from a person of Indian origin who has assumed foreign nationality is treated as as “foreign contribution”.

• A host of entities are barred from receiving foreign funds, including election candidates, those connected with a registered newspaper, judges, government servants or employees of any entity controlled or owned by the government and members of any legislature.

• Political parties and their office bearers, too, are prohibited from receiving foreign funds.

(Source: TH)

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