Centre set up PM CARES, indicates memo

Screenshot of the PM Cares site homepage.   | Photo Credit:

The Centre has repeatedly insisted that the PM CARES fund is not answerable to citizens under the RTI Act, as it is not a public authority. However, on the same day the fund was announced in March, the Ministry of Corporate Affairs (MCA) had made the case for PM CARES being a fund set up by the Central government.

File notings accessed through RTI show that MCA’s late night memo on March 28, clarifying that India companies’ contributions could be counted for their corporate social responsibility obligations, depended on the reasoning that the PM CARES fund was set up by the Central government. Otherwise, the thousands of crores immediately pledged by India’s biggest corporates from both the public and private sectors could not have been counted against their CSR obligations.

Also read | PM-CARES contribution need not be credited to NDRF: Supreme Court

Two months later, on May 26, the Companies Act was retrospectively amended, so that the validity of CSR donations is now no longer dependent on the fund being set up by the Centre. It was three days later, on May 29, that the Prime Minister’s Office (PMO) first stated that the PM CARES Fund is not a public authority under the RTI Act, in a delayed response to an RTI request filed by law student Sri Harsha Kandukuri. Institutions established by the government are defined as public authorities under the RTI Act.

The PM CARES fund was registered on March 27 as a public charitable trust, and announced through a press release issued by the PMO at 4.36 p.m. on Saturday, March 28. Donation pledges began to pour in instantly. At 9.52 p.m. that evening, Aparna Mudiam, a deputy director in the MCA’s CSR cell, drafted a circular clarifying that corporate contributions to PM CARES would be considered eligible CSR activity, and passed it up the chain of command. After a series of emails, Corporate Affairs Secretary Srinivas Injeti approved the circular for issuance at 11.29 p.m., according to records accessed through an RTI request filed by activist Anjali Bhardwaj.

The circular cited Schedule VII of the Companies Act, 2013, which lists permissible CSR activity, including “contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central government or the State governments for socio-economic development and relief…”

Also read | PM CARES Fund collected over ₹3,000 crore in 2019-20

The file noting on the circular makes the Ministry’s reasoning clear. “Item no. (viii) of the Schedule VII of the Companies Act, 2013 inter alia provides for contribution to any fund set up by the Central government for socio-economic development and relief. Contribution to PM CARES fund is therefore an eligible CSR activity,” it says.

On May 27, however, the MCA amended Schedule VII, directly inserting the PM CARES fund into the list, so that there was no more need to depend on the fund being set up by the Central government. The amendment was applied retrospectively, from March 28.

Also read | Contributions to CM fund will not qualify as CSR expenditure

“If MCA was relying on the fact that PM CARES was a fund set up by the Central government, then how is the PMO repeatedly denying information under the RTI Act claiming that the fund is not a public authority?” asked Ms. Bhardwaj. “What was the need for the retrospective amendment?”

Ms. Bhardwaj also questioned the Ministry’s rush to issue the circular late on March 28, Saturday night, with just two working days left until the end of the financial year. Data on the PM CARES website shows that ₹3,076 crore had been collected by March 31. RTIs filed by the Indian Express have also shown that a number of public sector companies donated to PM CARES using their unused CSR allocation for the 2019-20 financial year, which ended March 31.

Also read | How different is the PM CARES Fund from the PM’s National Relief Fund?

The Hindu’s queries to the MCA regarding the circular, and whether any company or government department had requested the clarification, were not answered.

Ms. Bhardwaj also filed RTI requests regarding the PM CARES fund with other government departments. The Law Ministry did not respond to a query on whether its comments were sought on the fund, while the Cabinet Secretariat said “there was no agenda item in any Cabinet meeting specifically related to the creation of the PM Cares Fund.”

A request to the PMO asking for all files held on PM CARES was denied, with the response that the fund is not a public authority under the RTI Act. Ms. Bhardwaj has filed an appeal noting that since the PMO is a public authority, it is required to disclose files it holds or controls regarding PM CARES, regardless of the status of the fund itself.

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Printable version | Dec 5, 2021 5:27:56 AM |

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