New Chief Justice J S Khehar has cracked the whip within a week of taking charge.
His first target turned out to be nearly 30 lakh NGOs and voluntary organisations across the country which are already under the scanner of the CBI for lack of financial transparency that is for not filing annual income and expenditure statements or refusal to subject themselves to audit.
The NGOs, most of which receive funds worth crore of rupees from the government and abroad, came under strict scrutiny of the Supreme Court on Tuesday when it ordered the Council for Advancement of People’s Action and Rural Technology (CAPART) and Centre to compulsory audit of all of the NGOs within three months and file a report in the court.
CRIMINAL PROCEEDINGS IN CASE OF MISAPPROPRIATION: SC BENCH
The bench said “mere blacklisting” of NGOs who do not file annual statements, the only action which was being taken till now, will not suffice but also criminal proceedings for misappropriation and civil action for recovery of disbursed funds should also be initiated. The bench also ordered formulation of guidelines for their regulation.
“It seems the respondents (Centre and CAPART) are not aware of the responsibility of audit despite General Financial Rules 2005 meant for such organisations. Keeping this in view we direct to complete the process of auditing by March 31, 2017. There can be no doubt about the fact that the amount disbursed is public money and needs to be accounted for. The only action now taken for non-compliance is blacklisting.
It is necessary to take civil as well as criminal action. They be taken immediately on completion of audit”, the SC said hearing a PIL filed by advocate M L Sharma seeking a tab on the functioning of NGOs. He argued that the Centre disbursed crores worth funds to the NGOs but was clueless what they did about it.
“It is your money why don’t you see what is happening to your money..public money..there should be some accountability process..at least you should be asking for utilisation reports”, CJI Khehar told Additional Solicitor General Tushar Mehta who appeared for the Centre.
The SC order came after Amicus Curiae (senior lawyer appointed to assist the court ) Rakesh Dwivedi cited a recent CBI report which said only 10 per cent filed annual income and expenditure statements.
Dwivedi said between 2002 and 2009 the Union and state governments released `6,654 crore to various NGOs for 2010-13.