The Supreme Court today asked the Centre to either come up with a legislation or implement the new guidelines to give more teeth to authorities for regulating the activities and utilisation of grants by over 32 lakh voluntary organisations or NGOs in the country.
"You have to take a fair decision as we have already passed certain directions in this regard. You have to implement them to give more teeth to the authorities. These are very serious issues," a bench comprising Chief Justice J S Khehar and D Y Chandrachud said.
Additional Solicitor General Tushar Mehta told the court that he needed four weeks to seek instructions as whether the government intends to bring in a legislation, as a decision will have to be taken at a highest level.
The apex court said that even without any law, the government can initiate civil and criminal action against the NGOs who misuse government grants.
The bench granted four weeks time to the Centre to file its response.
The Centre had earlier informed the apex court that it has framed new guidelines to regulate the activities of and grants given to the NGOs and voluntary organisations (VOs).
The government has said that a high-level committee under the chairmanship of S Vijaykumar, former secretary in the Ministry of Rural Development, has framed the guidelines and rules for the accredition of VOs/NGOs.
Under the new guidelines, Niti Aayog has been appointed as the nodal agency for the purpose of registration and accredition of VOs/NGOs seeking funding from the Centre, it had said in an affidavit filed on April 5.
The Aayog has been also tasked with maintaining a database to manage and disseminate information relating to NGOs/VOs. It had said that all VOs/NGOs, aspiring to be funded by the government, will have to register themselves in NGO- Darpan online and get a unique ID.
"In future, all funds to NGOs/VOs should be released through the public fund management system (PFMS)," the affidavit had said, adding a three-tier monitoring system would be instituted uniformly for the central government and ministries.
It said that fund-based accounting may be introduced for earmarked or designated funds by the VOs/NGOs and all grants received from the governments should be separately accounted for.
It had said that to regulate the funding and use of grants by the NGOs and VOs, their financial statements will be audited annually by the Comptroller and Auditor General of India and the chartered accountants.
The Centre had also barred the appointment of auditors if they were in any way related or had business interests with the office-bearers of the VOs/NGOs. The guidelines also stipulated disciplinary procedures in case of misappropriation of funds or breach of trust by the NGOs/VOs.
The guidelines were taken on record by the apex court.
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