Draft Guidelines providing stringent regulatory mechanism for NGOs

The Centre filed in Supreme Court on Wednesday its draft guidelines providing stringent regulatory mechanism for NGOs. Earlier, in January 2017, famous lawyer for his PILs, Advocate Mr. Manohar Lal Sharma, filled a PIL to regulate the unorganized NGOs ecosystem in the country. SC had asked the Centre to prepare guidelines to regulate NGOs and Voluntary Organisations after finding that nearly 30 lakh of them were operating in India.

In its order, the Court noted that substantial funding is allowed for NGOs and voluntary organisations. Further, Rules 210-212 of the General Financial Rules, 2005 provide for a regulation mechanism for NGOs, though the respondents are not aware of the same. The court noted,

“There are 32 lakh NGOs out of which nearly 3 lakh are filing balance sheets. The respondents are not aware of the responsibility of audit in the General Financial Rules…There can be no doubt that the funds disbursed by CAPART [to NGOs] is public money and needs to be accounted.”

It, therefore, directed the Centre to complete the exercise of audit and submit a report by March 31 this year. It was directed,

“In case of non-compliance, it is essential to initiate civil and criminal action immediately after the completion of the exercise.”

Most importantly, the Court also directed the Centre to lay down guidelines/rules for accreditation of NGOs, the manner in which they shall maintain accounts and auditing of the same.

Centre proposes stringent guidelines for NGOs and VOs requiring all existing ones to register afresh online with Niti Ayog‘s NGO-Darpan. The guidelines submitted by additional solicitor general Tushar Mehta to a bench headed by CJI J S Khehar required them to register afresh if they wish to get govt grants.
It said NGOs will be provided unique ID and subjected to income tax act and foreign contribution regulations act. Centre’s draft guidelines say NGOs/VOs past track record and performance will be put under scrutiny before grant of accreditation. The NGOs and VOs getting govt funds are required to execute a bond to refund the amount with 10% interest if work not done.

However, detailed draft copies of guidelines not available so that can not comment on in dept detail.

SC asked amicus curiae Rakesh Dwivedi to submit his suggestions on the draft guidelines in two weeks.