{"id":112970,"date":"2011-06-01T00:00:00","date_gmt":"2011-05-31T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/sarvajan-unnati-bodhini-vs-secretary-to-the-government-of-on-1-june-2011"},"modified":"2016-10-11T05:06:34","modified_gmt":"2016-10-10T23:36:34","slug":"sarvajan-unnati-bodhini-vs-secretary-to-the-government-of-on-1-june-2011","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/sarvajan-unnati-bodhini-vs-secretary-to-the-government-of-on-1-june-2011","title":{"rendered":"Sarvajan Unnati Bodhini vs Secretary To The Government Of … on 1 June, 2011"},"content":{"rendered":"
Delhi High Court<\/div>\n
Sarvajan Unnati Bodhini vs Secretary To The Government Of … on 1 June, 2011<\/div>\n
Author: S. Muralidhar<\/div>\n
        IN THE HIGH COURT OF DELHI AT NEW DELHI\n\n\n                                          W. P. (C) 566\/2011\n\n                                                             Reserved on: May 24, 2011\n                                                             Decision on: June 1, 2011\n\n        SARVAJAN UNNATI BODHINI                                      ..... Petitioner\n                      Through:                   Mr. Rakesh Kumar Khanna, Senior\n                                                 Advocate with Mr. Rajiv Tyagi,\n                                                 Advocate.\n\n                           versus\n\n\n        SECRETARY TO THE GOVERNMENT\n        OF INDIA AND ANR                            ..... Respondents\n                        Through: Ms. Maneesha Dhir, Sr. Panel Counsel\n                                 with Ms. Preeti Dalal, Advocate.\n\n         CORAM: JUSTICE S. MURALIDHAR\n\n                 1. Whether Reporters of local papers may be\n                       allowed to see the judgment?                           No\n                 2. To be referred to the Reporter or not?                    Yes\n                 3. Whether the judgment should be reported in Digest?        Yes\n\n                                     JUDGMENT\n<\/pre>\n
                                      01.06.2011<\/p>\n
1. This petition involves the interpretation of Section 11 (2) of the Foreign
\nContribution (Regulation) Act, 1976 (\u201eFCRA 1976\u201f) read with Section 6 (1A) thereof
\nand the effect of the repeal of the FCRA 1976 by the Foreign Contribution
\n(Regulation) Act, 2010 (\u201eFCRA 2010\u201f).\n<\/p>\n
Factual background\n<\/p>\n
2. The Petitioner, Sarvajan Unnati Bodhini, is a trust registered under the Indian Trusts
\nAct, 1882 and was created by a Trust Deed dated 4th May 2007. The Petitioner states
\nthat its objects include the provision of education and medical care to the under
\nprivileged. It also collaborates with non-governmental organizations (NGO\u201fs)
\nfunctioning in remote and backward areas for imparting education about the benefits
\nof health care, health insurance and risk sharing coverage at the grassroots level. The<\/p>\n
W.P. (C) 566 of 2011                                                               Page 1 of 9<\/span>
\n Petitioner is dependent on funding from philanthropic organizations. It is stated that
\nthe Petitioner has, since its inception and until the recent past, received foreign
\ncontributions\/donations after obtaining prior permission from Respondent No. 1
\nMinistry of Home Affairs (\u201eMHA\u201f), FCRA Division under Section 6 (1A) of the
\nFCRA 1976. The Petitioner completed three financial years of existence and became
\nentitled to apply for permanent registration in Form FC 8 under the Foreign
\nContribution (Regulation) Rules, 1976 (\u201eFCR Rules 1976\u201f) read with Section 6 (1) of
\nthe FCRA 1976. The Petitioner states that it has been regularly furnishing returns to
\nthe MHA, FCRA Division, Government of India in Form FC 3 in respect of the source
\nand application of the foreign contributions received by it from time to time. It is
\nstated that returns have been accepted by the MHA.\n<\/p>\n
3. The Petitioner received a communication dated 1st December 2009 from Erasmus
\nUniversiteit, Rotterdam for remittance of the balance grant of Euros 2,80,701 from
\nEuropean Community in respect of the project titled “Developing efficient and
\nresponsive community based Micro Health Insurance for India”. It is stated that the
\nPetitioner had earlier received the first part of the donation of Euros 70,000 from the
\nsame University for which prior permission was applied for and granted by a letter
\ndated 11th November 2009. Subsequently, on 3rd December 2009, the Petitioner
\napplied online to the FCRA Division for prior permission to receive an amount of
\nEuros 2,80,701 from Erasmus Universiteit, Rotterdam. The application was also filed
\nphysically on 7th December 2009.\n<\/p>\n
4. By a letter dated 5th January 2010, the FCRA Division informed the Petitioner that
\nthey expected to take a final view of the application within ninety days and therefore,
\nit would be appreciated if queries about the status of the application are made “only
\nafter two months from the date of issue of this letter”. This was followed by a letter
\ndated 5th March 2010 of the MHA informing the Petitioner as under:\n<\/p>\n
          “2. Due to certain difficulties, it is not possible to dispose of your
\n          application within ninety days. Accordingly, you are informed that
\n          it will take another thirty days from 7th March 2010 to dispose of
\n          your application”.\n<\/p><\/blockquote>\n
5. Thereafter on 25th March 2010, the MHA wrote the following letter to the
\nW.P. (C) 566 of 2011                                                               Page 2 of 9<\/span>
\n Petitioner:\n<\/p>\n
          “I am directed to refer to your application dated 3rd December
\n          2009 seeking grant of prior permission for receiving foreign
\n          contribution under Section 6 (1A) of the Foreign Contribution
\n          (Regulation) Act, 1976 and to inform that the permission of
\n          Central Government cannot be granted at present under the said
\n          Act as it will take further time to dispose of your case.\n<\/p><\/blockquote>\n
          2. Further you are advised that no foreign contribution should be
\n          accepted by you till prior permission for receiving foreign
\n          contribution is issued by this Ministry.” (emphasis in original)<\/p>\n<\/blockquote>\n
6. It is stated that further information was sought by the MHA from the Petitioner by
\nletters dated 5th April 2010 and 9th April 2010 with respect to the Petitioner\u201fs
\napplication dated 3rd December 2009. According to the Petitioner, it did not hear
\nanything on the said application thereafter.\n<\/p>\n
7. The Petitioner received a communication from another donor – Deutscher
\nGennossenschaffts und Raiffeisenverband E.V. (DGRV), stated to be a renowned
\neconomic organization in Germany, expressing its commitment to contribute an
\namount of Euros 80,000 to the Petitioner. The Petitioner applied to the MHA online on
\n16th June 2010 for prior permission to receive the donation of Euros 80,000. It is also
\nstated that the Petitioner applied physically on 17th June 2010. The Petitioner
\nmentioned that during the financial year 2009-10 it had received an amount of Euros
\n95,000 from the same donor DGRV for which the Respondents had granted prior
\npermission by its letter dated 11th November 2009.\n<\/p>\n
8. On 6th October 2010 the MHA wrote the following letter to the Petitioner:\n<\/p>\n
          “I am directed to refer to your application dated 16th June 2010
\n          seeking grant of prior permission for receiving foreign
\n          contribution under Section 6 (1A) of the Foreign Contribution
\n          (Regulation) Act, 1976 and to inform that the permission of
\n          Central Government cannot be granted at present under the said
\n          Act as it will take further time to dispose of your case.\n<\/p><\/blockquote>\n
         2. Further you are advised that no foreign contribution should be
\n         accepted by you till prior permission for receiving foreign
\n         contribution is issued by this Ministry.” (emphasis in original)<\/p>\n
W.P. (C) 566 of 2011                                                           Page 3 of 9<\/span>\n<\/p><\/blockquote>\n
 9. Thereafter, the Petitioner did not hear from the MHA even after the expiry of ninety
\ndays. Aggrieved by the letters dated 25th March 2010 and 6th October 2010 of the
\nMHA, the Petitioner, in this petition, seeks quashing of the said letters and a
\ndeclaration that the Petitioner is entitled to unconditionally accept donations for which
\nit had applied for prior permission by applications dated 3rd December 2009 and 16th
\nJune 2010.\n<\/p>\n
Submissions of counsel\n<\/p>\n
10. Mr. Rakesh Khanna, learned Senior counsel appearing for the Petitioner submits
\nthat in terms of the Proviso to Section 11 (2) FCRA 1976 there was a deemed grant of
\npermission on the expiry of the period of ninety days after the date of the receipt of the
\nrespective applications by the MHA. It is submitted that once there is a deemed grant
\nof prior permission, it cannot be affected by subsequent repeal of the FCRA 1976 by
\nthe FCRA 2010 which came into effect from 26th September 2010. Mr. Khanna
\npointed out that as far as the letter dated 6th October 2010 was concerned, the MHA
\nhad not informed the Petitioner of any special difficulty.\n<\/p>\n
11. Appearing on behalf of the Respondents Ms. Maneesha Dhir, learned counsel
\nsubmitted that the letters dated 25th March 2010 and 6th October 2010 must be
\nconstrued as refusal to grant permission although the letters stated that the FCRA
\nDivision would take further time to dispose of the applications dated 3rd December
\n2009 and 16th June 2010 respectively. According to her, the deeming provision under
\nthe Proviso to Section 11 (2) FCRA 1976 was not attracted. It is further submitted
\nthat in terms of Section 54 (2) of the FCRA 2010 all applications pending as on the
\ndate of coming into force of the FCRA 2010, i.e. 26th September 2010, must be treated
\nas pending under the corresponding provisions of the FCRA 2010 and therefore, if at
\nall, would have to be processed under the FCRA 2010. Ms. Dhir submitted that under
\nSection 12 of the FCRA 2010 (which corresponds to Section 11 of the FCRA 1976)
\nthere was no deemed grant of permission on the expiry of ninety days. According to
\nher, since the amounts for which prior permission was sought by the Petitioner was
\nsubstantial and since reports of the State Government on the activities of the Petitioner
\nwere not forthcoming despite reminders, the prior permission could not be granted
\nwithin the prescribed time limit. Ms. Dhir reiterated the stand taken in the counter
\naffidavit that during the course of processing of the applications for receipt of foreign<\/p>\n
W.P. (C) 566 of 2011                                                           Page 4 of 9<\/span>
\n contributions under the FCRA 1976, unless it was convinced that the verification
\nreports are in order and the targeted people are actually benefited, no permission may
\nbe given by the central government especially when the applicant has received huge
\nforeign funds previously. Hence, it may not be possible that all the prior permission
\ncases can be decided within the stipulated period of ninety days. Often the exact
\nreasons are not conveyed to the applicants due to security considerations.\n<\/p>\n
Deemed permission under Proviso to Section 11 (2) FCRA 1976\n<\/p>\n
12. The first issue to be considered is whether there was deemed permission in terms
\nof the proviso to Section 11 (2) FCRA 1976. Under Section 6 (1) of the FCRA 1976 it
\nis incumbent on the applicant association “having a definite cultural, educational,
\nreligious or social programme” to register itself with the central government in
\naccordance with the FCR Rules before it accepts any foreign contributions. Once
\nregistered, the association shall give within such time and in such manner as may be
\nprescribed, an intimation to the central government as to the amount of each foreign
\ncontribution received by it, and the source from which and the manner in which such
\nforeign contribution was utilized by it. An association not registered with the central
\ngovernment in accordance with the FCR Rules 1976 can in terms of Section 6 (1A),
\naccept any foreign contribution “only after obtaining the prior permission of the
\ncentral government”. As far as the Petitioner was concerned, since it had applied in
\nForm FC 8 and was awaiting grant of registration under Section 6 (1) FCRA 1976, it
\nwas incumbent upon the Petitioner to apply in Form FC 1A for prior permission in
\nterms of Section 6 (1A) of the FCRA 1976 read with Rule 3 (aa) of the FCR Rules
\n1976.\n<\/p>\n
13. Section 11 of the FCRA 1976 reads as under:\n<\/p>\n
          “11. Application to be made in prescribed form for obtaining
\n          prior permission to accept foreign contribution or hospitality\n<\/p><\/blockquote>\n
          –\n<\/p><\/blockquote>\n
          (1) Every individual, association, organization or other person,
\n          who is required by or under this Act to obtain the prior permission
\n          of the central government to accept any foreign contribution or
\n          foreign hospitality, shall, before the acceptance of any such
\n          contribution or hospitality, make an application for such
\n          permission to the Central Government in such form and in such
\n          manner as may be prescribed.\n<\/p><\/blockquote>\n
W.P. (C) 566 of 2011                                                            Page 5 of 9<\/span><\/p>\n
           (2) If an application referred to in sub-section (1) is not disposed
\n          of within ninety days from the date of receipt of such application,
\n          the permission prayed for in such application shall, on the expiry
\n          of the said period of ninety days, be deemed to have been granted
\n          by the Central Government.\n<\/p><\/blockquote>\n
          Provided that, where, in relation to an application, the central
\n          government has informed the applicant the special difficulties by
\n          reason of which his application cannot be disposed of within the
\n          said period of ninety days, such application shall not, until the
\n          expiry of a further period of thirty days, be deemed to have been
\n          granted by the Central Government.”\n<\/p><\/blockquote>\n
14. Under Section 11 (2) of FCRA 1976 if an application for prior permission is not
\ndisposed of within ninety days from the date of receipt of such application, the
\npermission prayed for in such application is, on the expiry of the said period of ninety
\ndays, deemed to have been granted by the central government. The Proviso to Section
\n11 (2) FCRA 1976 states that if the central government has informed the applicant
\nabout the “special difficulties by reason of which his application cannot be disposed of
\nwithin the said period of ninety days” such application shall not “until the expiry of a
\nfurther period of thirty days, be deemed to have been granted by the central
\ngovernment”.\n<\/p>\n
The first application dated 3rd December, 2009\n<\/p>\n
15. The first application dated 3rd December 2009 was, admittedly, received online by
\nthe FCRA Division on that date itself. The ninety day period would come to an end on
\n2nd March 2010. On 5th March 2010 the central government in terms of the Proviso to
\nSection 11 (2) stated that “it will take another thirty days from 7th March 2010” to
\ndispose of the application. In other words, the FCRA Division was treating the date of
\nthe physical filing of the application, i.e. 7th December 2009, as the date of the
\napplication and was seeking for further thirty days after the expiry of ninety days in
\nterms of the Proviso to Section 11 (2). The thirty day extension period was coming to
\nan end on 7th April 2010. By a letter dated 25th March 2010 the Petitioner was simply
\ninformed that “permission of the central government cannot be granted at present”
\nand that “it will take another thirty days from 7th March 2010 to dispose of your
\napplication.” The subsequent letter dated 25th March 2010 indefinitely extended the
\ntime for granting the permission notwithstanding the deeming provision in the form of
\nW.P. (C) 566 of 2011                                                             Page 6 of 9<\/span>
\n the Proviso to Section 11 (2) FCRA 1976. Clearly, the communication dated 25th
\nMarch 2010 was not consistent with the Proviso to Section 11 (2) FCRA 1976. In
\nother words, the expiry of thirty days beyond the period of ninety days would result in
\ngrant of deemed permission. The communication dated 25th March 2010 by the MHA
\ndefeated the Proviso to Section 11 (2) FCRA 1976 stating that “it will take further
\ntime to dispose of”. In light of the unambiguous wording of the Proviso to Section 11
\n(2) FCRA 1976, the MHA could not have kept the Petitioner\u201fs application pending
\nbeyond 6th April 2010.\n<\/p>\n
16. It is not possible to accept the contention of the MHA that the letter dated 25th
\nMarch 2010 was in fact a refusal to grant permission. A reading of the letter only
\nstates that permission cannot be granted “at present” and further that “it will take
\nfurther time to dispose of the case”. The Petitioner\u201fs application dated 3rd December
\n2009 was still treated by the central government as pending on that date, i.e. 25th
\nMarch 2010. There was no communication of refusal to grant permission and, there
\nwas no question of keeping the said application pending after the expiry of thirty days
\nbeyond 7th March 2010, i.e., beyond 7th April 2010. By that time the FCRA 1976 had
\nnot been repealed and the deemed permission automatically came into effect.
\nTherefore, in terms of the Proviso to Section 11 (2) FCRA 1976, it must be held that
\ninsofar as the Petitioner\u201fs application dated 3rd December 2009 is concerned there was
\na deemed permission of the central government for the Petitioner to receive foreign
\ncontribution covered by the said application.\n<\/p>\n
The second application dated 16th June, 2010\n<\/p>\n
17. As regards the second application dated 16th June 2010, the period of ninety days
\ncame to an end on 15th September 2010. After the expiry of the ninety day period, the
\ncentral government on 6th October 2010 simply stated that the permission could not be
\ngranted \u201eat present\u201f and that \u201eit will take further time to dispose of the case\u201f.
\nImportantly, the central government did not invoke the provisions of the FCRA 2010
\nwhich came into effect on 26th September 2010. In terms of the Proviso to Section 11
\n(2) FCRA 1976, the central government failed to inform the Petitioner of the special
\ndifficulties because of which the application could not be disposed of within a period
\nof ninety days.\n<\/p>\n
W.P. (C) 566 of 2011                                                        Page 7 of 9<\/span><\/p>\n
 18. The central government has to necessarily inform the applicant of the \u201especial
\ndifficulties\u201f in not granting the permission within ninety days of the receipt of the
\napplication. The wording of the Proviso to Section 11 (2) FCRA 1976 makes this
\nrequirement mandatory. Even after the expiry of ninety days no special difficulties
\nwere expressed by the central government as far as the Petitioner\u201fs application dated
\n16th June 2010 was concerned. In fact, even the communication dated 6th June 2010
\nwas not one under the Proviso to Section 11 (2) FCRA 1976 since the central
\ngovernment did not refer to any special difficulties it was encountering in granting the
\npermission. This position becomes clear when the letter dated 6th October 2010 is
\ncontrasted with letter dated 5th March 2010 where special difficulties were expressed
\nby the central government as the reason for not being able to dispose of the
\nPetitioner\u201fs first application dated 3rd December 2009. Thus even the thirty day
\nextension in terms of the Proviso to Section 11 (2) FCRA 1976 was not available to
\nthe FCRA Division in respect of the second application dated 16th June 2010. The
\ndeemed permission became effective on 15th September 2010.\n<\/p>\n
Effect of repeal of FCRA 1976 by FCRA 2010\n<\/p>\n
19. The FCRA 2010 no doubt repeals the FCRA 1976. However FCRA 2010 also
\ncontains a savings clause in the form of Section 54 (2). The relevant portion of Section
\n54 (2) reads as under:\n<\/p>\n
        “54. Repeal and saving.\n<\/p><\/blockquote>\n
        …\n<\/p><\/blockquote>\n
        (2) Notwithstanding such repeal, –\n<\/p><\/blockquote>\n
        (a) anything done or any action taken or purported to have been
\n        done or the provisions under the repealed Act shall, insofar as it is
\n        not inconsistent with the provisions of this Act, be deemed to have
\n        been done or taken under the corresponding provisions of this Act;”\n<\/p><\/blockquote>\n
20. The deemed permission became effective in respect of both the applications filed
\nby the Petitioner under Section 6 (1A) read with the Proviso to Section 11 (2) of the
\nFCRA 1976 prior to the coming into force of the FCRA 2010. That deemed
\npermission would therefore remain undisturbed in terms of Section 54 (2) of the
\nFCRA 2010. Further, the Proviso to Section 11 (1) FCRA 2010 reads as under:\n<\/p>\n
        “11. Registration of certain persons with Central Government. –\n<\/p><\/blockquote>\n
W.P. (C) 566 of 2011                                                            Page 8 of 9<\/span><\/p>\n
      (1) Save as otherwise provided in this Act, no person having a definite cultural,
\n         economic, educational, religious or social programme shall accept foreign
\n         contribution unless such person obtains a certificate of registration from the
\n         Central Government:\n<\/p><\/blockquote>\n
        Provided that any association registered with the Central Government under
\n        section 6 or granted prior permission under that section of the Foreign
\n        Contribution (Regulation) Act, 1976 (49 of 1976), as it stood immediately
\n        before the commencement of this Act, shall be deemed to have been registered
\n        or granted prior permission, as the case may be, under this Act and such
\n        registration shall be valid for a period of five years from the date on which this
\n        section comes into force.”\n<\/p><\/blockquote>\n
21. The above Proviso to Section 11 (1) FCRA 2010 makes it clear that if there was a
\ndeemed permission that was already granted under the FCRA 1976 at the time of the
\nFCRA 2010 coming into effect, such deemed permission should be taken to have been
\ngranted under the FCRA 2010. Viewed from the perspective of the FCRA 2010 as
\nwell, the deemed permission in respect of the two applications of the Petitioner dated
\n3rd December 2009 and 16th June 2010 in terms of the Proviso to Section 11 (2) FCRA
\n1976 remains unaffected. Also, the proviso to Section 11 (2) FCRA 1976 regarding
\ndeemed permission in respect of applications for prior permission cannot be defeated
\nby the central government by simply keeping applications pending beyond the outer
\nlimit within which such applications were required to be disposed of in terms of the
\nFCRA 1976.\n<\/p>\n
Conclusion\n<\/p>\n
22. For all the aforesaid reasons, this writ petition is allowed and the communications
\ndated 25th March, 2010 and 6th October, 2010 of the MHA are hereby set aside. The
\nRespondents will now pass necessary orders within four weeks from today clarifying
\nthe deemed permission granted in relation to the Petitioner\u201fs applications dated 3rd
\nDecember 2009 and 16th June 2010.\n<\/p>\n
                                                                S. MURALIDHAR, J
\nJune 1, 2011
\nrk<\/p>\n
W.P. (C) 566 of 2011                                                           Page 9 of 9<\/span>\n <\/p>\n","protected":false},"excerpt":{"rendered":"
Delhi High Court Sarvajan Unnati Bodhini vs Secretary To The Government Of … on 1 June, 2011 Author: S. Muralidhar IN THE HIGH COURT OF DELHI AT NEW DELHI W. P. (C) 566\/2011 Reserved on: May 24, 2011 Decision on: June 1, 2011 SARVAJAN UNNATI BODHINI ….. Petitioner Through: Mr. Rakesh Kumar Khanna, Senior Advocate […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[14,8],"tags":[],"class_list":["post-112970","post","type-post","status-publish","format-standard","hentry","category-delhi-high-court","category-high-court"],"yoast_head":"\nSarvajan Unnati Bodhini vs Secretary To The Government Of ... on 1 June, 2011 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/sarvajan-unnati-bodhini-vs-secretary-to-the-government-of-on-1-june-2011\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Sarvajan Unnati Bodhini vs Secretary To The Government Of ... on 1 June, 2011 - 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