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2022 Supreme(SC) 340

SUPREME COURT OF INDIA
A.M. KHANWILKAR, DINESH MAHESHWARI, C.T. RAVIKUMAR, JJ.
Noel Harper and Others – Petitioners
Versus
Union of India and Another – Respondents
Writ Petition (Civil) Nos. 566, 634, 751 of 2021
Decided On : 08-04-2022

Advocates appeared:
For the Petitioner(s):Gopal Sankaranarayanan, Ashishek Jabaraj, Srishti Agnihotri, Nupur Raut, Ishita Chowdhury, Sanjana Grace Thomas, Gautam Jha, Piyush Chhabra, Bripendra Singh, Praveen Swarup, Advocates
For the Respondent(s):Tushar Mehta, Ld. Kanu Aggrawal, M.K. Maroria, Sanjay Kapur, Swarupama Chaturvedi, Sanmaya Kapoor, Himanshi Goel, Advocates

Headnote:(A) Constitution of India - Articles 14, 19, and 21 - Foreign Contribution (Regulation) Act, 2010 - Amendments via the 2020 Act - Legal validity challenged on grounds of arbitrariness and infringement of fundamental rights. (Paras 1-3, 11-12, 22, 57, 87)

(B) Fundamental Rights - Right to receive foreign contributions - Not absolute; can be subject to regulation and law. (Paras 21-22, 79-80)

Facts of the case:
Petitioners, comprising trusts engaged in social work, challenged amendments to the Foreign Contribution Act which imposed stricter controls on receiving and utilizing foreign contributions, mandating that contributions be received only through a specified account at a central bank branch in New Delhi. The petitioners alleged violation of Articles 14, 19, and 21. (Paras 1-3)

Findings of Court:
The amendments are legal, aimed at enhancing transparency and accountability, curbing misuse of funds, and ensuring that NGOs utilize the contributions for defined purposes only. The requirement to open FCRA accounts at designated banks was justified to streamline monitoring and oversight. The court found no infringement of fundamental rights. (Paras 87)

Issues: Whether the amended provisions of the Foreign Contribution Act violate fundamental rights under Articles 14, 19, and 21 of the Constitution and if they impose unreasonable restrictions on NGOs. (Paras 4-5, 21-22)

Ratio Decidendi: The Supreme Court upheld the amendments, affirming that regulatory frameworks for accepting foreign contributions do not infringe upon constitutional rights, and that the amendments serve significant state interests in maintaining sovereignty and integrity. (Paras 60-64)

Result: Writ petitions dismissed; amendments upheld as constitutional. (Paras 88)

JUDGMENT :

A.M. KHANWILKAR, J.

1. These petitions under Article 32 of the Constitution of India primarily assail the constitutional validity of the amendments to the provisions of the Foreign Contribution (Regulation) Act, 20101 [for short “the 2010 Act” or “the Principal Act” as the case may be] vide the Foreign Contribution (Regulation) Amendment Act, 20202 [for short “the 2020 Act” or “the Amendment Act” as the case may be] which has come into effect on 29.9.2020, in particular, Sections 7 , 12(1A), 12A and 17(1), being manifestly arbitrary, unreasonable and impinging upon the fundamental rights guaranteed to the petitioners under Articles 14, 19 and 21 of the Constitution.

2. Re: Writ Petition (Civil) No. 566 of 2021

    (a) Petitioner No. 1 in this petition along with Carol Faison founded a trust in the name of “The Care and Share Charitable Trust” in Vijayawada, India (bearing Registration No. 242/1997), in the year 1997. It is the case of the petitioners that the Trust is also registered with the Income Tax authorities and Ministry of Home Affairs, Government of India including under the Foreign Contribution (Regulation) Act, 19763 [for short “the 1976 Act”] for receipt of foreign funds (FCRA No. 010260151 dated 8.12.1998 and renewed on 10.8.2016 under the 2010 Act). Petitioner No. 1 is serving as one of the trustees of the said Trust and petitioner No. 2 (Nigel Mills) is a social worker and one of the trustees of the stated Trust. The Trust is engaged in the social upliftment activity such as helping children below the poverty line in Vijayawada (Andhra Pradesh, India), street children, children of sex workers, physically challenged kids, shelter orphans, abandoned babies and assisting juveniles detained in the observation home (local reformatory). The Trust has built and is running nine schools in different slums. It has rescued over 1000 street children, 165 infants, HIV positive and AIDS orphans of Vijayawada. The Trust also engages in daily milk program for 500 kindergarten children since year 2000. The Trust has been awarded National Award for Child Welfare by the Government of India, Ministry of Women and Child Development in the year 2007, for its exceptional work and contribution in the field of child welfare.

    (b) The petitioner Nos. 3 and 4 are also trustees of National Worker Welfare Trust (NWWT), which is registered under the Indian Trusts Act, 18824 [for short “the 1882 Act”] in Secunderabad, Telangana on 17.5.2016. Even this trust is registered with Ministry of Home Affairs, Government of India under the 2010 Act for receipt of foreign funds ( FCRA Registration No. 010230883). It is engaged in rehabilitation of migrant workers, with International Labour Organisation (ILO) and addresses the concerns of women workers from the marginalised communities and prospective migrant workers (interstate and oversees), families of migrants, communities, leaders of communities, returnees, women organisations, trade unions, local panchayats, Mandal, district and State department connected with labour and administration and governance related to these workers. Both these trusts, it is urged, are dependent upon foreign contributions to meet their day-to-day expenses. However, with the amendments effected in year 2020 to the provisions of the 2010 Act, a new dispensation has been set forth, which in their opinion, is manifestly arbitrary. For, it entails in cancellation of certificate5 [The expression “certificate” as defined in Section 2 (1)(e) of the 2010 Act as amended, reads thus: “2. Definitions - (1) In this Act, unless the context otherwise requires: (a) to (e) xxx xxx xxx (e) “certificate” means certificate of registration granted under sub-section (3) of section 12.”] of the trust permitting receipt of foreign contributions for being utilised towards the activities of the concerned trust. Similarly, the operational “ FCRA account” will be barred from receiving foreign contribution. The petitioner-Trusts and similarly

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