The PM CARES Fund has received exemption from all provisions of the law meant to regulate foreign donations, although it does not seem to meet the pre-condition of being a body established and owned by the government whose accounts are audited by the Comptroller and Auditor General of India (CAG).
Responding to a recent query under the Right to Information (RTI) Act asking for details and documents on the exemption, the Home Ministry said it had to “seek the consent” of PM CARES before giving out the information, as it would be considered a “third party” under the RTI Act. It also invoked the clause that allows information to be denied if it is held as part of a fiduciary relationship.
According to the Frequently Asked Questions (FAQ) section on the PM CARES website, the Fund “has received exemption from operation of all provisions of the Foreign Contribution (Regulation) Act, 2010” or FCRA. In the last few days of March, the Fund collected ₹39.68 lakh in foreign currency donations. It is not clear how much of the rupee donations were also from foreign sources.
The FCRA is meant to regulate the acceptance and use of foreign contributions and to prevent their use for activities detrimental to national interest. This includes gifts and monetary contributions from foreign sources, whether in Indian or foreign currency. Organisations which wish to receive foreign donations must have a definite cultural, economic, educational, religious or social programme, and must register under the Act, and receive a clearance from the government. There are 49,843 associations registered under FCRA, of which 20,674 have been cancelled, according to government data, with the Centre cracking down on NGOs receiving foreign funds in recent years.
Section 50 of the Act allows the Central government to issue orders exempting any organisation (apart from political parties) from the provisions of FCRA if it feels it necessary or expedient in public interest, subject to conditions specified in the order.
In July 2011, the Home Ministry issued an order exempting all bodies established by a Central or State Act which are required to have their accounts audited by the CAG.
Earlier this year, on January 30, 2020, it issued a fresh order superseding the previous one, “to exempt organisations (not being a political party), constituted or established by or under a Central Act or a State Act or by any administrative or executive order of the Central Government or any State Government and wholly owned by the respective Government and required to have their accounts compulsorily audited by the Comptroller and Auditor General of India (CAG) or any of the agencies of the CAG”.
The PM CARES Fund is a public charitable trust registered under the Registration Act, 1908. It was not set up through a Central or State Act. It has argued that it is not a public authority under RTI; all bodies established by the government are public authorities under that Act. The Fund is audited by an independent auditor, not by the CAG.
Although it does not seem to fulfil the conditions in the January order, PM CARES has been granted exemption from FCRA. “Yes, PM CARES can be given exemption under FCRA,” a senior Central government official told The Hindu when asked about the validity of the provision. “The exemption is typically given to Central universities,” added the official. Such universities are usually set up by a Central Act, and are subject to CAG audit.
In June, RTI activist Commodore Lokesh Batra (Retd.) filed a request with the Ministry of Home Affairs asking for the dates when the PM CARES Fund had applied for and been granted exemption under the FCRA, and the files and documents regarding the processing and approval of its case.
After an appeal was filed on August 14, the MHA responded on August 19, saying that the information sought “pertains to a third party”, and “cannot be acceded to...without seeking [its] consent”. It included a letter sent to the PM CARES Fund, at the Prime Minister’s Office, asking whether the information should be disclosed. It referenced Section 11(1) of the RTI Act, which deals with information “which relates to or has been supplied by a third party and has been treated as confidential by that third party”. The clause adds that “except in the case of trade or commercial secrets protected by law, disclosure may be allowed if the public interest in disclosure outweighs in importance any possible harm or injury to the interests of such third party”.
In its response to Commodore Batra, the MHA also referenced Section 8(1)(e), which allows the denial of information “available to a person in his fiduciary relationship, unless the competent authority is satisfied that the larger public interest warrants the disclosure of such information”.
“Information like the dates on which FCRA approval was granted is not of a fiduciary nature, and is held by the MHA itself, not any third party. Why is it not being released?” asked Commodore Batra. The MHA has not yet disclosed any information in response to the RTI request.