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What is FCRA and why were congressional foundation registrations revoked?

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Ministry of Interior (MHA) The Foreign Contribution Regulatory Act (FCRA) revokes its license Rajiv Gandhi Foundation (RGF) and Rajiv Gandhi Charitable Trust (RGCT), organizations associated with the Gandhi family, alleged violations of the law.

In 2020, the central government established an inter-ministerial committee to “coordinate investigations” into the funding of three Nehru-Gandhi family-related trusts – RGF, RGCT and Indira Gandhi Memorial Trust.

The BJP had claimed at the time that the RGF had received funding from China to “conduct work that is not in the interest of the country”. Also, PMLA (Anti-Money Laundering Act), Income Tax Act, FCRA etc. Investigations into violations of various legal provisions would also be conducted.

All three organizations are led by Sonia Gandhi. Former Prime Minister Manmohan Singh and Congress leaders P Chidambaram, Rahul Gandhi and Priyanka Gandhi Vadra are among the RGF’s board of trustees.

Here’s what the lawsuit is all about and what it might mean to have licenses revoked.

What are the allegations against RGF?

In June 2020, after the Congress party criticized the government for handling border issues with China in Ladakh, the BJP said Congress had no moral right to talk about the country’s security after accepting money from China.

“I was shocked to see on television today that in 2005-06 the People’s Republic of China and the Chinese embassy gave a large sum to the RGF. This is a secret relationship between Congress and China. These people get funding from China and then they do work that is not in the country’s interest. These studies pave the way for that. “People want to know how much they are paid and what research they are doing,” said BJP chief JP Nadda.

“You’re getting $300,000 in donations and teaching us nationalism,” Nadda said.

Former Telecom Minister Ravi Shankar Prasad said: “The donor list of the RGF annual report 2005-06 clearly shows that it has received a donation from the Embassy of the People’s Republic of China. We want to know why this donation was received.”

The two senior leaders of the BJP were referring to donations to the RGF in 2005-06 and its annual report on the period when the RGF conducted a study on the free trade agreement between India and China and suggested that it would be beneficial to India.

The report referred to the Embassy of the People’s Republic of China as one of the “partner organizations and donors”. China’s name is also on the list of donors of the Rajiv Gandhi Institute for Contemporary Studies (RGICS), a policy think tank sponsored by the RGF.

What happened after these allegations?

Two weeks later, the central government formed an inter-ministerial committee to “coordinate investigations” into the funding of the RGF, RGCT and Indira Gandhi Memorial Trust.

The Home Office said the committee will “coordinate investigations into violations of various legal provisions of PMLA (Anti-Money Laundering Act), Income Tax Act, FCRA (Foreign Contribution Regulation Act), etc.” by these three organizations.

This committee was led by a special director from the Executive Directorate (ED) and consisted of members from the Income Tax Department, the Ministry of Finance, the Ministry of Urban Development and the MHA.

How does the FCRA work and what happens in violations?

The FCRA was enacted during the Emergency to prevent foreign entities from pumping money into entities in India to achieve their own ends. The law has been changed over the years as in 2020 and the government is now able to exercise tighter control and scrutiny over the receipt and use of foreign funds by NGOs.

Generally, the FCRA requires that every person or NGO wishing to receive foreign donations must (i) be registered under the Law, (ii) open a bank account at the State Bank of India, Delhi for receiving foreign funds, and (iii) ) to use it for the purpose and as stipulated in the Law.

They must also file an annual declaration and not transfer funds to another NGO. The law prohibits the receipt of foreign funds by election candidates, journalists or newspaper and media publishing companies, judges and government officials, members of the legislature and political parties or their officials, and organizations of a political nature – except in certain special circumstances. statuses with necessary notifications.

Revocation of an FCRA license can occur for multiple reasons, such as “in the Central Government’s view, revocation of the certificate should be in the public interest” or an investigation finds a false statement in its application.

The Ministry also has the power to suspend an NGO’s registration for 180 days pending an investigation and can freeze its funds.

Now what happens in the case of three trusts?

All revocation decisions of FCRA license by the government can be appealed to the Supreme Court. The Congress party is likely to approach the judiciary against the MHA’s order.

Party leaders described the allegations about the three trusts in 2020 as part of a “witch hunt” against the Gandhi family and the party.

“The Rajiv Gandhi Foundation has nothing to add, nothing to fear because you have all the machines and you can ask any question in any investigation… But you need to be completely exposed… you don’t ask these questions to many holy cows… Party spokesman Abhishek Manu Singhvi said: He is harassing the opposition,” he said.