21

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION SPECIAL LEAVE PETITION (CIVIL) NO.33928 OF 2011 (UNDER ARTICLE 136 OF THE CONSTITUTION OF INDIA)
(From the impugned judgment / final order dated 16.09.2011 passed by the High Court of Delhi in Writ Petition (Civil) No. 5793 of 2011.)

BETWEEN: POSITION OF THE PARTIES In the In this High Honble Court Court Indian Social Action Forum (INSAF), Through its General Secretary, A-124/6, Katwaria Sarai, New Delhi 110016 Petitioner Versus The Union of India, Through its Secretary, Ministry of Home Affairs, North Block, Central Secretariat, New Delhi - 110001 Respondent Respondent Petitioner

TO THE HONBLE THE CHIEF JUSTICE OF INDIA AND HIS HONBLE COMPANION JUDGES OF THE SUPREME COURT OF INDIA. THE SPECIAL LEAVE PETITION OF THE PETITIONER MOST RESPECTFULLY SHEWETH:
1. This Special Leave Petition has been filed against the

Final order / Judgment dated 16.9.2011 by which Writ Petition (Civil) No. 5793 of 2011 filed by the Petitioner before the High Court of Delhi was dismissed in limine

22
without issuing notice to the Respondent. The Writ Petition under Article 226 of the Constitution was filed by the Petitioner challenging constitutional validity of Sections 5(1) and 5(4) of the Foreign Contribution (Regulation) Act, 2010 (herein after referred to as the 2010 Act) and Rules 3(i), 3(v) & 3(vi) of the Foreign Contribution (Regulation) Rules, 2011 (hereinafter referred to as the Rules of 2011) by which the Central Government has been given unchecked and unbridled powers to categorize virtually any organization as organization of political nature, not being a political party and thereby denying Foreign Contribution. The petitioner had submitted before the High Court that the said provision in the Act of 2010 and Rules of 2011 are violative of Articles 14, 19(1)(a), 19(1)(c) & 21 of the Constitution. The High Court dismissed the Writ Petition, thereby upholding validity of Sections 5(1) and 5(4) of the 2010 Act and Rules 3(i), 3(v) & 3(vi) of the Rules of 2011. 2. QUESTIONS OF LAW: Honble Court: (i) Whether the High Court was justified in deciding the question of validity of the impugned provisions of Foreign Contribution (Regulation) Act, 2010 and Foreign Contribution (Regulation) Rules, 2011, in limine, without even asking the Union of India to file its response? (ii) Whether the Sections 5(1) and 5(4) of the Foreign Contribution (Regulation) Act, 2010 and Rules 3(i), 3(v) & 3(vi) of the Foreign Contribution (Regulation) Rules, 2011 are ultra-vires and violative of Articles 14, 19(1)(a), 19(1)(c) & 21 of the Constitution?

The following questions of law arise for consideration by this

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(iii) Whether the findings given by the High Court on Constitutional validity of impugned provisions is legally tenable? 3. DECLARATION IN TERMS OF RULE 4(2): appeal has been filed by them against the impugned judgment and order. 4. DECLARATION IN TERMS OF RULE 6: true copies of the pleadings/documents which formed part of the records of the case in the Courts below against whose order, the leave to appeal is sought for in this Petition. 5. GROUNDS: Constitution of India for Special Leave to appeal, inter alia, on the following, amongst other, grounds: A Because the High Court failed to consider Petitioners submission that in Section 5 (1) of the 2010 Act the terms activities, ideology and programme have been used widely; they have not been defined either in the 2010 Act or in the Rules of 2011. Such vague and undefined expressions are therefore, amenable to abuse resulting in arbitrary and illegal action. Though, the proviso to Section 5 (1) of the 2010 Act says that by framing guidelines and specifying ground/grounds, an organisation shall be specified as an organisation of a political nature. The Rules of 2011, in fact do not laydown any guidelines for defining the above terms. The ground / grounds provided in the Rules of 2011 do not

The Petitioner states that no other petition seeking leave to

The Annexures produced along with Special Leave Petition are

The Petitioner prefers this petition under Article 136 of the

24
cover all the situations envisaged by the terms, activities, ideology and programme. In certain areas the Rules travel beyond the main Section 5 of the 2010 Act. B. Because the term authority as mentioned in Section 5 (4) of the 2010 Act has not been defined anywhere in the 2010 Act or Rules of 2011. The discretion has been given to the Central Government to either forward the representation to such an authority or not. From Section 5(5) of the 2010 Act it is further clear that the Central Government may consider Authority. The discretion either the representation given to the Central alone or representation along with the report of the Government under Section 5(4) of the 2010 Act is without any guidelines; there is no reason or rationale to point out as to when the representation will be forwarded to an Authority and in which case it will not be. The nature and character of the Authority has not been defined. It is not clear whether the authority will be independent of the Central Government. Therefore, Section 5(4) of the 2010 Act as far as exercise of its discretion is concerned and as far as the vagueness of the Authority is concerned, is violative of Article 14 of the Constitution. The High Court failed to consider these submissions. For the purpose of convenient reference Section 5 of the 2010 Act is quoted below: Section 5 of the 2010 Act states that,
5. Procedure to notify an organisation of a political nature. (1) The Central Government may, having regard to the activities of the organisation or the ideology propagated by the organisation or the programme of the organisation or the association of the organisations with the activities of

25
any political party, by an order published in the Official Gazette, specify such organisation as an organisation of a political nature not being a political party, referred to in clause (f) of sub-section (1) of section 3: Provided that the Central Government may, by rules made by it, frame the guidelines specifying the ground or ground s on which an organisation shall be specified as an organisation of a political nature. (2) Before making an order under sub-section (1), the Central Government shall give the organisation in respect of whom the order is proposed to be made, a notice in writing informing it of the ground or grounds, on which it is proposed to be specified as an organisation of political nature under that sub-section: (3) The organisation to whom a notice has been served under sub-section (2), may, within a period of thirty days from the date of the notice, make a representation to the Central Government giving reasons for not specifying such organisation as an organisation under sub-section (1): Provided that the Central Government may entertain the representation after the expiry of the said period of thirty days, if it is satisfied that the organisation was prevented by sufficient cause from making the representation within thirty days. (4) The Central Government may, if it considers it appropriate, forward the representation referred to in sub-section (3) to any authority to report on such representation. (5) The Central Government (4), specify may, after such considering the as an representation and the report of the authority referred to in sub-section organisation organisation of a political nature not being a political party and make an order under sub-section (1) accordingly. (6) Every order under sub-section (1) shall be made within a period of one hundred and twenty days from the date of issue of notice under sub-section (2): Provided that in case no order is made within the said period of one hundred and twenty days, the Central Government shall, after recording the reasons therefore,

26
make an order under sub-section (1) within a period of sixty days from the expiry of the said period of one hundred and twenty days. (emphasis supplied)

(C)

Because the petitioner had referred to and relied upon the debates in Parliament for the purpose of pointing out that the vagueness of the expression Political Nature contained in Section 5 of the 2010 Act was accepted by the Government. The debates in Parliament can be relied upon for ascertaining intention of the Parliament for the purpose of interpretation. The Foreign Contribution (Regulation) Bill, 2010 [Bill No. CXII-C of 2006] (hereafter Bill of 2010) was passed by Rajya Sabha on 19.08.2010. In the Rajya Sabha, the following important debates took place:Shri M. Rama Jois (Rajya Sabha member from Karnataka) whose book Legal and Constitutional History of India is prescribed by the Bar Council of India for the law degree, made the following comments, Now, I will give an example. What about trade unions? There are a number of trade unions which are also registered organisations and about most of the trade unions we know to which political parties they are affiliated or belong to. If this sweeping power is given to the Central Government, the Central Government may say that a trade union is affiliated to a particular party, therefore, prevent them from getting foreign contribution. Therefore, my objection is that this 'political nature' is a very dangerous, wide and very vague expressions. The Supreme Court has held if a provision is capable of both use and abuse, then, it is violative of article 14 of the Constitution. Right from 1958 the Supreme Court in Ramkrishan Dalmia's case has said that

27
any provision made by the legislation cannot be such that it is both capable of use as well as abuse. This is what has happened. Therefore, which is an organisation of a political nature is left to the sweet will of the Central Government. Section 5 provides that before making an order under sub-section (I), the Central Government shall give the organisation in respect of whom the order is proposed to be made, a notice in writing informing it of the ground or grounds, on which it is proposed to be specified as an organisation of political nature. So, the Government can issue a notice. It can say, 'your organisation is considered, in our opinion, an organisation of political nature, and therefore, we want to prohibit you from getting foreign contribution.' What do you say, Sir? Then, there is another interesting provision in Clause 5(2), which says, 'provided the Central Government may by rule specify' etc. Sir, 5(3) says that the organisation to whom a notice has been served under subsection (2), may, within a period of thirty days from the date of the notice, make a representation to the Central Government giving reasons for not specifying such organisation as an organisation under sub-section (I). The meaning is that the Central Government will issue notice stating reason to declare an association as of a political nature. Then they have given the right of representation. Then what is going to be done with that representation you see, provided that the Central Government may entertain. So, the time limit is there, more time is also given. Sir, subclause 4 is most important. It says that the Central Government, may, if it considers it appropriate, forward the representation referred to in sub-

28
section (3) to any authority to report on such representation. What is that authority? First of all, it is left to the decision of the Central Government to refer or not to refer. Now, even if it decides to refer the representation given by a particular party or association, then, it can refer to some authority. Which is that authority, it is not specified. Then the Central Government may, after considering the representation and the report of the authority, etc. So, the Central Government may send it to some authority and that whatever opinion is given by that authority is taken into consideration and the Central Government will take a decision. My submission is you are doing it without specifying the authority, the status of the authority to which the representation is to be referred. My first objection is to power to declare an association of a political nature is itself dangerous. It is totally going to destroy the Fundamental Rights under article 19 (1) (C) of the Constitution. Even trade union activities can be barred from getting foreign contribution by exercise of this power. As far as this authority is concerned, the word authority is also extremely vague. It can be some authority of the choice of the Government. They can take the report of that authority supplied) In response to the queries raised by Members of Parliament, including Shri M. Rama Jois and others, Shri P. Chidambaram, Home Minister said that, Sir, many of the things which the hon. Members said have to be dealt with in the rules. They may appear vague, but any law, Mr. Rama Jois knows, if and pass the final order.(emphasis

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you read it without the rules will appeal to be vague. But, many of the things have to be provided for in the rules. Wherever it is necessary, wherever it becomes excessive delegation, we have provided it here. But most of the things have to be done in the rules and guidelines and that is why I think any law which is drafted will appear to vest a large amount of discretion. But the rule making power is intended to control that discretion or power. Many of these will indeed be dealt with under the rules. Now, Mr. Rama Jois mentioned clause 5. Clause 5 is already there in Section 5 of the present Act. You mentioned Clause 9. Clause 9 is already Section 10 in the present Act. These are not new provisions. These are the provisions which have been repeated because these are wholesome provisions that have stood the test of law. 'Political nature', in fact, we have said that the present law is rather vague. The new law says on political nature we will lay down guidelines, we will frame rules, we will issue a show cause notice, and we will give the reasons why an organisation is being called an organisation of a political nature. We will get their reply, and then we will pass an order either of placing them in the category of organizations of a political nature, and publish that notification. If it is abused, if it is unreasonable, they know how to challenge it in the court of law. In fact, we are making it more transparent, we are making it more rule based and more reason based.(emphasis supplied)

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D. Because the High Court did not consider the challenge to Rules 3 (i), (v) & (vi) of the Rules of 2011 as being ultravires the 2010 Act itself, besides being unconstitutional. The said Rules are extremely wide, without any checks and balances and give arbitrary and wide discretion, which render the said Rules being subjected to misuse and abuse. These grounds in the said Rules suffer both from unreasonableness, arbitrariness as well as for not creating a discernible classification between the political activities and other social or public activities. They seek to interfere with the activities of the organisation in important areas of national life which is impermissible under the Constitution. The Rules 3(i), 3(v) & 3 (vi) of the Rules of 2011 are therefore, contrary to the object of the 2010 Act as well as ultra-vires Articles 14, 19(1)(a), 19(1)(c) and 21 of the Constitution. grounds are quoted below:
3.

For convenient reference the

Foreign Contribution (Regulation) Rules, 2011 guidelines/

Guidelines being a

for political

declaration party.The

of

an central

organization to be of a political nature, not Government may specify any organization as organization of political nature on one or more of the following grounds: (i) Organization or bylaws: (ii)
(iii)

having

avowed

political

objectives in its Memorandum of Association any Trade Union whose objectives include activities for promoting political goals: any voluntary action group with objectives of a political nature or which participates in political activities;

31
(iv)

front or mass organizations like Students Unions, Workers Unions, Youth Forums and Womens wing of a political party;

(v)

organization of farmers, workers, students, youth based on caste, community, religion, language or otherwise, which is not directly aligned to any political party, but whose objectives, as stated in the Memorandum of Association or activities gathered through other material evidence, include steps towards advancement of political interests of such groups;

(vi)

any organization, by whatever name called, which habitually engages itself in or employs common jail methods in of political action of like bandh or hartal, rasta roko, rail roko or bharo support public causes.(emphases supplied)

E.

Because the High Court failed to consider the specific challenge which was made to Rule 3(i) of Rules of 2011. Under the said Rule, the Central Government is empowered to declare on organisation to be a political nature in case the organization, in its memorandum of association or byelaws, has avowed political objective. The said Rule nowhere defines what is meant by political objective. In a democracy governed by the Rule of Law and having a written Constitution, it is permissible that an organisation or an individual protests or insists on the government keeping up its political objective consistent with the Constitution and Directive Principles. The term political objective includes the governance as well as policies of the Government. Therefore, if in the memorandum or byelaws of an organization, the avowed objective is to oppose government policies which violate

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the Constitution and Directive Principles, it may be accused of having a political objective. The said provision is thus totally unguided, unchecked and confers arbitrary and unreasonable powers to the Central Government and therefore, violative of the Articles 14, 19(1)(a) and 19(1) (c) of the Constitution. F. Because the High Court failed to consider the challenge to Rule 3(v) of the Rules of 2011. Under the said Rule, an organization of farmers, workers, students, youth based on caste, community, religion, language or otherwise which is not directly aligned to any Political party, can be categorized as a political organization if its objective include steps towards advancement of political interest of such groups; or activities gathered through material evidence include steps towards advancement of political interest of such group. It is thus clear that if an organization of farmers indulges in an activity for the purpose of empowering itself for realization of its human rights/ Fundamental Rights, which may include political empowerment as well, it may be put under the category of organization of a political nature. The 2010 Act or the Rules of 2011 do not define what is the meaning and scope of the expression political interest. Under the International Covenant on Civil and Political Rights, 1967 (hereafter referred to as ICCPR) of which India is a signatory, the civil and political rights are treated as part of human rights. Under the provisions of the Protection of Human Rights Act, 1993 (hereafter referred to as Act of 1993). Human Rights have been defined under Section 2(d), which means the rights relating to life, liberty, equality and dignity of the individual guaranteed by the Constitution or embodied in the International Covenants. International Covenants is also defined under Section 2(f) which mean covenant on Civil and Political Rights

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(ICCPR) & International Covenants on Economic Social and Cultural Rights (ICESCR). Therefore, what has been provided as political right in the ICCPR has been taken to be part of Human Rights. The aim and object of the Act of 1993 is to promote, protect and implement the civil and political rights of an individual/organization. It is, therefore, not understood on what basis for e.g. the farmers organization will be termed as political organization to deny foreign contribution. The denial of foreign contribution will, in fact, result in infringement of activities of the organization which are a necessary and inalienable part of democracy and Rule of Law. Such an action will not be consistent with the values of a Sovereign democratic republic which recognizes the right of protest. The said provision, therefore, is violative of not only Article 14 but also Articles 19(1)(a) & 19(1)(c) of the Constitution. The power which has been given in the Rules of 2011, therefore, is un-canalized, arbitrary and does not make a difference between a political activity and advancement of political rights of an organization. G Because the High Court ought to have considered the impact of Rule 3(vi) of the Rules of 2011 which is drastic in nature. The said Rule is also unconstitutional for the reason that if an organization indulges in bandh, hartal, rasta roko, rail roko, or jail bharo, as which actions are in support of public causes, it will be termed political action and such organization will be declared as a political organization. The term habitually is prone to gross misuse and abuse. In a democracy, some of these actions are accepted methods of expressing the public grievances. They are the only tools in the hands of people to show their disagreement or dissatisfaction with the functioning of the Government. The said provision also suffers from the vice of

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arbitrariness and unreasonableness because by using these arbitrary guidelines any organization which has indulged in bandh, hartal jail bharo etc. will be termed as a political organization and will be denied foreign contribution. By this action of the Central Government, the right of a Citizen/Organization of its democratic right of protest will be seriously affected. The said provision, therefore, is violative of Articles 14, 19(1) (a) and 19(1)(c) of the Constitution. H. Because the petitioner relied upon the following

judgments in support of its contention that Rule 3(vi) of the Rules of 2011 is unconstitutional because it prohibits citizens right to protest and express their views subject to reasonable restriction provided in the Constitution. The High Court has referred to these judgments but there is no consideration of these judgments while discussing the constitutionality of the impugned Rule. Himmat Lal K Shah Vs Commissioner of Police Ahmedabad [(1973) 1 SCC 227] that, Para 31: It seems to us that it follows from the above discussion that in India a citizen had, before the Constitution, a right to hold meetings on public streets subject to the control of the appropriate authority regarding the time and place of the meeting and subject to considerations of public order. Para 35: If the right to hold public meetings flows from Art. 19 (1) (b and Art. 19 (1) (d) it is obvious that the State cannot impose unreasonable restrictions. Para 70: Public meeting in open spaces and public streets forms part of the tradition of our national

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life. In the pre- Independence days such meetings have been held in open spaces and public streets and the people have come to regard it as a part of their privileges and immunities. Further, it has been held in Rohtas Industries Ltd Vs Rohtas Industrial Staff Union [(1976) 2 SCC 82] Para 20: Our constitution guarantees the right to form associations, not for gregarious pleasure, but to fight effectively for the redressal of grievances. Our constitution is sensitive to workers rights. English history, political theory and life style being different from Indian conditions where the Father of the Nation organised we cannot boycotts and mass English satyagrahas incorporate

conditions without any adaptation into Indian Law. I. Because the High Court did not consider the wide amplitude of the expression Political Right. It is submitted that rights conferred under the ICCPR, among other covenants, have been accepted as a part of municipal law by the Supreme Court as they enhance the content of Article 21 of the Constitution. [vide: PUCL Vs UOI and Ors 1997 (3) SCC 433 and Kapila Hingorani Vs. State of Bihar 2003 (6) SCC 1]. Under the Protection of Human Rights Act, 1993 the provisions of ICCPR have, in fact, been treated as part of Article 21 of the Constitution. By denying the political advancement or political expression, an organizations human rights which are part of Article 21, have been curtailed. Similarly, by categorizing certain actions as being political for the purpose of denying them certain benefits under foreign contribution, in fact, really amounts to suppression of their human rights as well as freedom of

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expression under Article 19(1)(a) of the Constitution. These rules are therefore, unconstitutional. J. Because the High Court did not refer to the document of Planning Commission of India by which the Planning Commission wanted to encourage/ empower the voluntary sector. The Petitioner had submitted that the Planning Commission drafted National Policy on the Voluntary Sector, 2007 which inter-alia, provided for encouraging, enabling and empowering the voluntary sector so that it can contribute to the social, cultural and economic advancement of the people of India. This document, inter-alia, says : 1.2 The voluntary sector has contributed significantly to finding innovative solutions to poverty, deprivation, discrimination and exclusion, through means such as awareness raising, social mobilization, service delivery, training, research, and advocacy. The voluntary sector has been serving as an effective non-political link between the people and the Government. This policy recognizes the important role that the voluntary sector has to play in various areas and affirms with the the growing voluntary need sector for by collaboration

Government, as well as by the private sector, at the local, provincial and national levels.
3.1.2 To enable VOs to legitimately mobilize necessary

financial resources from India and abroad;

4.1

The independence of VOs allows them to explore alternative paradigms of development to challenge social, economic and political forces that may work against public interest and to find new ways to combat poverty, deprivation and other social problems. It is therefore crucial that all laws, policies, rules and regulations relating to VOs

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categorically safeguard their ( supplied) K. Because the High Court ought to have considered that Non-governmental organisations (NGOs) function in various fields like environment, human rights, gender discrimination as well as issues concerning children, farmers, involved. students The etc. of In all these activities of people empowerment and creation of awareness about rights is process empowerment ultimately leads to realization of their human and constitutional rights, namely, social, political, economic, social and cultural rights, among others. L. Because the High Court ought to have considered that it is natural that organizations working against discrimination of women and for their empowerment will lead to participation of these women in local selfgovernance, gram panchayat and advocacy as that may be thought as one of the ways to end discrimination. Similarly, an organisation working for the farmers rights and against mindless acquisition of their lands, may oppose the government policy on acquisition. This may be taken as a political action against the Government. An organisation working for the workers rights may oppose the liberalization policy of the Government. This may be taken as a view against the national interest. NGOs working for the environment may advocate against inappropriate industrialization policy of the Government leading to the destruction of the environmental wealth. This may be taken as an activity against development and, therefore, branded as a political action against the political setup. In all these civil society struggles, the autonomy, while simultaneously ensuring their accountability. Emphases

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organisations will be invariables opposing the policy of the Government or its actions which in turn is influenced by the political regime in power. NGOs protesting peacefully in support of their cause may suffer arrest and put in jails by the Government branding their actions as being political. These ground realities ought to have been considered by the High Court while examining constitutional validity of the impugned provisions. M. Because the term Political in Nature or Political Objective should have been distinguished from political empowerment which is a part of constitutional and human rights. Political empowerment of people is necessary so that they realize their political duties which ultimately sub serves the purpose of vibrant democracy. This is quite different from politics which is aligned with the political parties and their ideologies. One can be political but still not aligned to any political party. He may convey ideas on how the State should be run on certain political principles and what is most suitable within the parameters of the Constitution, for example, a person/organisation following Gandhi ideology may talk of gram swaraj and that the present politics is not permitting the achievement of the Constitutional goals as envisioned by the Father of the Nation. Can it be said that the activities of this organisation/persons are of political nature? In view of the above, the definition of political nature, political objective, political ideology are different from the normal political actions of political parties. NGOs play a complementary/supplementary part in doing what the State should ideally do. The only laudable objective of both is to empower people as against poverty, illiteracy, homelessness, discrimination etc. and in the process, if need be, to counter Government policies, laws, political decisions etc.

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N. Because the consequences of withdrawal of foreign contribution of an NGO/civil society is very serious. The civil and evil consequences of cancellation of foreign contribution registration could be that not only persons who are employed with the NGO or civil society would lose their employment but it would have an adverse effect on the activities done by the organisation namely, those working for upliftment of poor, farmers, fighting against discrimination of women, for protection of environment and for establishing the democratic rights of the people etc. O. Because the impugned provisions give the Central Government a blanket power to pick and choose from NGOs/CSOs anyone whom they dont want to function due to their strong opposition, which they demonstrate through constitutionally permissible methods. This is where the entire problem lies. The Governments power to pick and choose, discriminate, act arbitrarily by abusing powers given under the 2010 Act, is quite obvious. The said power comes from the impugned provisions and, therefore, they have to be struck down as unconstitutional. P. Because the High Court failed to consider that the unfettered discretion provided under Section 5 of the 2010 Act is further enhanced by the guidelines under Rule 3 of the Rules of 2011. This unfettered, undefined and vague discretion is violative of Article 14 of the Constitution. Further, in addition, impugned Guidelines provided under Rule 3 of the Rules of 2011 are arbitrary, unjust, unreasonable and violative of Article 14 of the Constitution. Art. 19(1) (a) (b) & ( c ) is violated as the

40
impugned
(i)

provisions

travel

beyond

the

reasonable

restrictions provided under Art. 19 (2) (3) & (4) vide : State of W. B. vs. Anwar Ali Sarkar : AIR 1952 SC 75 at 86 Para 38 (Mahajan J.) at 90-92 Para 49 and 50 (Mukherjea J.)
(ii)

Shri Ramkrishna Dalmiya vs. Justice Tendulkar AIR 1958 SC 538 at 548 (Para 12 (iii) K.T. Moopil Nair vs. State of Kerala AIR 1961 SC 552 at 558 (Para 8) Maneka Gandhi vs. Union of India 1978 (1) SCC 248. Smt. Damyanti Naranga vs. The Union of India And Ors. 1971 (1) SCC 678

(iii)

(iv)

(v)

(vi)

Kameshwar Prasad and Ors. Vs. State of Bihar and Anr, AIR 1962 SC 1166 at 1170 (Para 13)

Q.

The Petitioner craves leave to add/amend the grounds, if required in the interest of justice.

6.

GROUNDS FOR INTERIM RELIEF

No grounds for interim relief. 7. MAIN PRAYER: It is, therefore, most respectfully prayed that this Honble Court may be pleased to:(a) Grant Special Leave to Appeal against the order/judgment dated 16.9.2011 passed by the High Court of Delhi at New Delhi in Writ Petition (Civil) No. 5793 of 2011. (b) PASS such other and further orders as may be deemed fit and proper in the facts and circumstances of the case.

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8. INTERIM RELIEF No interim relief is prayed for. Settled by: Mr. Sanjay Parikh, Advocate (Ms. ANITHA SHENOY) Drawn on: 31 October, 2011. Filed on: __ November, 2011 Place: NEW DELHI Advocate for the Petitioner A-187, Defence Colony, New Delhi DRAWN AND FILED BY

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION SPECIAL LEAVE PETITION (CIVIL) No. ______ OF 2011 (UNDER ARTICLE 136 OF THE CONSTITUTION OF INDIA) IN THE MATTER OF : Indian Social Action Forum (INSAF) Petitioner Versus Union of India CERTIFICATE Certified that the Special Leave Petition is confined only to the pleadings before the Court whose order is challenged and the other documents relied upon in those proceedings. No additional facts, documents or grounds have been taken therein or relied upon in the Special Leave Petition. It is further certified that the copies of the documents/annexures attached to the Special Leave Petition are necessary to answer the . Respondent .

42
question of law raised in the Petition or to make out grounds urged in the Special Leave Petition for consideration of this Honble Court. This certificate is given on the basis of the instructions given by the petitioner/person authorised by the petitioner whose affidavit is filed in support of the Special Leave Petition. FILED BY

(Ms. ANITHA SHENOY) ADVOCATE FOR THE PETITIONER NEW DELHI DATED: __ November, 2011
IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION SPECIAL LEAVE PETITION (CIVIL) No. IN THE MATTER OF : Indian Social Action Forum (INSAF) Versus Union of India AFFIDAVIT I Chitranjan Singh, S/o late Shri Bahadur Singh, aged about 59 years, R/o A-124/6, Katwaria Sarai, New Delhi 110016 do hereby solemnly affirm and state as under: 1) I say that I am General Secretary of the Petitioner-Forum in I say that I am aware of the facts . Respondent OF 2011

Petitioner

the above Special Leave Petition.

and circumstances of the case and I am competent to swear this Affidavit on behalf of all the petitioners. 2) Dates I say that the contents of the Special Leave Petition to and List of to are true to my own knowledge as derived from the

mentioned in paragraph nos. 1 to 8 on pages

43
records and legal advice received and believed by me to be true. I further say that the contents of the Special Leave Petition i.e. Prayer Clause and Certificate are true to my own knowledge. I further say that the contents I.A.s are true to my knowledge. 3) I say that Annexures P-1 to Pcontained in pages to are

true copies of the respective originals and form part of the records of the Courts below. DEPONENT VERIFICATION Verified that the contents of the above affidavit mentioned in paras 1 to 3 are true and correct and nothing material has been concealed therefrom. Verified at New Delhi, on this ____ day of October, 2011. DEPONENT

B
SYNOPSIS This Special Leave Petition has been filed against the Final order / Judgment dated 16.9.2011 by which WP (C) No. 5793 of 2011 filed by the Petitioner before the Delhi High Court was dismissed in limine. The Writ Petition under Article 226 of the Constitution was filed by the Petitioner challenging constitutional validity of Section 5(1) and 5(4) of the Foreign Contribution (Regulation) Act, 2010 (herein after referred to as the 2010 Act) and Rule 3(i), 3(v) & 3(vi) of the Foreign Contribution (Regulation) Rules, 2011 (hereinafter referred to as the Rules of 2011) by which the Central Government has been given unchecked and unbridled powers to categorize virtually any organization as organization of political nature, not being a political party and thereby denying Foreign Contribution. The petitioner had submitted before the High Court that the said provision in the Rules of 2011 are violative of Articles 14, 19(1)(a), 19(1)(c) & 21 of the Constitution. The High Court dismissed the Writ Petition, thereby upholding validity of Sections 5(1) and 5(4) of the 2010 Act and Rules 3(i), 3(v) & 3(vi) of the Rules of 2011. LIST OF DATES 5th May, 2004 The 2004. Indian Social Action Forum (INSAF) is a forum of peoples movements, NGOs, human rights groups, etc. all over India, involved in resisting and globalization, combating communalism Petitioner-INSAF is registered under the

Societies Registration Act (XXI) of 1860 on 5 May

defending democracy. INSAF believes that the fundamental rights enshrined in the Constitution of India need to be safeguarded against blatant

C
and rampant violations by the State and private corporations. INSAF has actively campaigned against land grab by corporations, ecological disaster by mining companies, water privatization, genetically power, modified food, policies hazardous of nuclear anti-people international

financial institutions like World Bank and Asian Development Bank, repeal of draconian antidemocratic legislations like, Armed Forces Special Powers Act and Unlawful Activities (Prevention) Act. INSAF firmly believes in a secular and peaceful social order and opposes communalism and the targeted attacks on the lives and rights of people regularly including fact religious findings, minorities. peoples INSAF organizes campaigns, workshops, tribunals,

conventions,

solidarity actions for peoples movements and educational-publications. INSAF is also actively involved in international fora like Jubilee South, NGO Forum on ADB, Asia Europe Peoples Forum, Barcelona Consensus, etc. The Petitioner-INSAF has organized several public hearings and conventions like the convention on repression of peoples movements in December, 2010 in New Delhi, Independent Peoples tribunal on development, displacement and repression in Jharkhand during February, 2009. INSAF has several publications in English and Hindi to its credit like: 1. 2. Peace Counts exhibition Report of the Independent Peoples tribunal on 3. development, displacement and repression in Jharkhand Water laws in India, Pakistan, Bangladesh and Nepal

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4. 5. 6. 7. 8. 9. 23.05.2005 The Hoodwinked in the hothouse: false solutions on climate change UID: tacking profiling and surveillance of Seedlings Agrofuels Seedlings Indian Agrofuels Seedlings Climate Crisis Panchayati Raj (in Hindi only) draft Bill named Foreign Contribution citizens

Management and Control) Bill, 2005 (hereafter FCMC Bill 2005 for short), as was presented to the Cabinet, has been uploaded on the Ministry of Home Affairs website for seeking comments/views of different stakeholders by 31.07.2005. The said FCMC Bill 2005 was referred to the Group of Ministers by the Cabinet on 23.06.2005. 24.06.2005 seminar & 25.06.2005 on Foreign Contribution (Regulation) Act, 1976 wherein suggestions of various stakeholders were considered. 18.12.2006 The Foreign Contribution (Regulation) Bill, 2006 [Bill No. CXII of 2006] (hereafter referred to as the 2006 Bill) was introduced in the Rajya Sabha by Shri S. Reghupathy, Minister of State for Home Affairs. A true and correct copy of the said Bill of 2006 is hereto marked and annexed as ANNEXURE P1. The Ministry of Home Affairs organized a national

22.12.2006

In

pursuance

of

the

rules

relating

to

the

Department-related

Parliamentary

Standing

Committees, the Chairman, Rajya Sabha, referred

E
the 2006 Bill to the Committee on Home Affairs for examination and report within three months. 09.02.2007 The Committee on on Home the Affairs Bill (hereafter inviting

referred to as the Committee) issued a press communiqu 2006 views/suggestions. 12.06.2007 The Committee in its meeting heard the

presentation of the Home Secretary, Government of India on the 2006 Bill. 31.7.2007 The Committee heard representatives of the Planning Commission on the compatibility of the Bill of 2006 vis--vis the National Policy on Voluntary Sector (a policy document of the Voluntary Sector Cell, Planning Commission, Government of India). The National Policy on Voluntary Sector, 2007 was considered and approved by the Cabinet on 17.05.2007 and it was notified in the Gazette of India on 31.07.2007. The National Policy on Voluntary Sector, 2007 states that, Para 4.1: The independence of VOs allows them to explore alternative paradigms of development to challenge social, economic and political forces that may work against public interest and to find new ways to combat poverty, deprivation and other social problems. It is therefore crucial that all laws, policies, rules and regulations relating to VOs categorically safeguard their autonomy, while simultaneously ensuring their accountability. Para 4.7: International funding of voluntary organizations plays a small, but significant part in supporting such organizations and their work in the country. An organization seeking foreign funding must be registered under the Foreign Contribution (Regulation)

F
Act. This law prescribes stringent screening norms that often restrict the ability of VOs to avail foreign funds. When approved, there are problems like funds must be held in a single bank account, thus presenting enormous difficulties to VOs working at different locations. The Government will review the FCRA and simplify its provisions that apply to VOs, from time to time, in consultation with the joint consultative group to be set up by the concerned Ministry (as suggested under para 5.4). A true copy of the National Policy on Voluntary Sector, 2007 is hereto marked and annexed as ANNEXURE P2. 16.7.2007 17.7.2007 3.10.2007

The Committee in its sittings heard the views of Dr. Bimal Jalan, Member of Parliament, Rajya Sabha and ex-Governor, Reserve Bank of India (RBI) and representatives of the RBI, State Bank of India, ICICI Bank, HDFC Bank, Catholic Bishops Conference of India, National Council of Churches in India, National Council of YMCA of India, Representatives of Voluntary Action Network India and Institute of Chartered Accountants of Dr. Bimal Jalan, Member of Parliament and exGovernor of RBI submitted before the Committee that making the provisions in the Bill stringent may result in stifling the legitimate activities of the NGOs more than their illegitimate activities. Six major national Political Parties submitted that India is a democratic republic. So everyone has the right to be part of the political process. Prohibition of organization of political nature from receiving foreign contribution seems to be

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inconsistent with the rights guaranteed by the Constitution of India. 06.11.2007 & 09.01.2008 The Committee in its sittings heard

representatives of Planning Commission on the compatibility of the 2006 Bill vis--vis National Policy on Voluntary Sector, a policy document of Voluntary Sector Cell, Planning Commission, Government of India. The Committee also heard Heads of the four expert groups who had worked on the draft policy. The National Policy on Voluntary Sector, 2007 was considered and approved by the Cabinet on 17.05.2007 and it was notified in the Gazette of India on 31.07.2007. The National Policy on Voluntary Sector, 2007 states that, Para 4.1: The independence of VOs allows them to explore alternative paradigms of development to challenge social, economic and political forces that may work against public interest and to find new ways to combat poverty, deprivation and other social problems. It is therefore crucial that all laws, policies, rules and regulations relating to VOs categorically safeguard their autonomy, while simultaneously ensuring their accountability. Para 4.7: International funding of voluntary organizations plays a small, but significant part in supporting such organizations and their work in the country. An organization seeking foreign funding must be registered under the Foreign Contribution (Regulation) Act. This law prescribes stringent screening norms that often restrict the ability of VOs to avail foreign funds. When approved, there are problems like funds must be held in a single bank account, thus presenting enormous difficulties to VOs working at different locations. The Government will review the FCRA and simplify its provisions that apply to VOs, from time to time, in consultation with the joint consultative group to be set up by the concerned Ministry (as suggested under para 5.4).

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18.02.2008 The Petitioner received registration under Foreign Contributions (Regulation) Act, 1976. INSAF receives foreign funds support from Bread for the World (Germany), SWISSAID (Switzerland), HIVOS (Netherlands), Grassroots International (USA) and Global Greengrants Fund (USA). A true and correct copy of the Memorandum of Association of the Petitioner, certificate of registration as well as letter dated 18.2.2008 by the Ministry of Home Affairs, Government under of India regarding Contribution registration 3 (Colly). Foreign

(Regulations) Act, 1976 is filed as ANNEXURE P-

15.05.2008 & 16.05.2008 04.07.2008

The

Committee

took

up

clause-by-clause

consideration of the 2006 Bill. The Committee considered the draft Report in its sitting on 04.07.2008 and adopted the same. 21.10.2008 The Committees 134th Report on the Foreign Contribution (Regulation) Bill, 2006 was presented to the Rajya Sabha and laid on the table of Lok Sabha. A true copy of the said 134th report of the Committee on Home Affairs is hereto marked and annexed as ANNEXURE P4.

19.08.2010

The Foreign Contribution (Regulation) Bill, 2010 [Bill No. CXII-C of 2006] (hereafter referred to as the 2010 Bill) was passed by the Rajya Sabha. In the Rajya Sabha, the following important debates took place:-

I
7.1 Shri M. Rama Jois (Rajya Sabha member from Karnataka) whose book Legal and Constitutional History of India is prescribed by the Bar Council of India for the law degree made the following comments, Now, I will give an example. What about trade unions? There are a number of trade unions which are also registered organization and about most of the trade unions we know to which political parties they are affiliated or belong to. If this sweeping power is given to the Central Government, the Central Government may say that a trade union is affiliated to a particular party, therefore, prevent them from getting foreign contribution. Therefore, my objection is that this political nature is a very dangerous, wide and very vague expressions. The Supreme Court has held if a provision is capable of both use and abuse, then, it is violative of article 14 of the Constitution. Right from 1958 the Supreme Court in Ramkrishan Dalmias case has said that any provision made by the legislation cannot be such that it is both capable of use as well as abuse. This is what has happened. Therefore, which is an organization of a political nature is left to the sweet will of the Central Government. Section 5 provides that before making an order under sub-section (I), the Central Government shall give the organization in respect of whom the order is proposed to be made, a notice in writing informing it of the ground or grounds, on which it is proposed to be specified as an organization of political nature. So, the Government can issue a notice. It can say, your organization is considered, in our opinion, an organization of political nature, and therefore, we want to prohibit you from getting foreign contribution. What do you say, Sir? Then, there is another interesting provision in Clause 5(2), which says, provided the Central Government may by rule specify etc. Sir, 5(3) says that the organization to whom a notice has been served under sub-

J
section (2), may, within a period of thirty days from the date of the notice, make a representation to the Central Government giving reasons for not specifying such organization as an organization under subsection (I). The meaning is that the Central Government will issue notice stating reason to declare an association as of a political nature. Then they have given the right of representation. Then what is going to be done with that representation you see, provided that the Central Government may entertain. So, the time limit is there, more time is also given. Sir, sub-clause 4 is most important. It says that the Central Government, may, if it considers it appropriate, forward the representation referred to in sub-section (3) to any authority to report on such representation. What is that authority? First of all, it is left to the decision of the Central Government to refer or not to refer. Now, even if it decides to refer the representation given by a particular party or association, then, it can refer to some authority. Which is that authority, it is not specified. Then the Central Government may, after considering the representation and the report of the authority, etc. So, the Central Government may send it to some authority and that whatever opinion is given by that authority is taken into consideration and the Central Government will take a decision. My submission is you are doing it without specifying the authority, the status of the authority to which the representation is to be referred. My first objection is to power to declare an association of a political nature is itself dangerous. It is totally going to destroy the Fundamental Rights under article 19 (1) I of the Constitution. Even trade union activities can be barred from getting foreign contribution by exercise of this power. As far as this authority is concerned, the word authority is also extremely vague. It can be some authority of the choice of the Government. They can

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take the report of that authority and pass the final order. 7.2 In response to the queries raised by

members including Shri M. Rama Jois and others, Shri P. Chidambaram, Home Minister said that, Sir, many of the things which the hon. Members said have to be dealt with in the rules. They may appear vague, but any law, Mr. Rama Jois knows, if you read it without the rules will appeal to be vague. But, many of the things have to be provided for in the rules. Wherever it is necessary, wherever it becomes excessive delegation, we have provided it here. But most of the things have to be done in the rules and guidelines and that is why I think any law which is drafted will appear to vest a large amount of discretion. But the rule making power is intended to control that discretion or power. Many of these will indeed be dealt with under the rules. Now, Mr. Rama Jois mentioned clause 5. Clause 5 is already there in Section 5 of the present Act. You mentioned Clause 9. Clause 9 is already Section 10 in the present Act. These are not new provisions. These are the provisions which have been repeated because these are wholesome provisions that have stood the test of law. Political nature, in fact, we have said that the present law is rather vague. The new law says on political nature we will lay down guidelines, we will frame rules, we will issue a show cause notice, and we will give the reasons why an organization is being called an organization of a political nature. We will get their reply, and then we will pass an order either of placing them in the category of organizations of a political nature, and publish that notification. If it is abused, if it is unreasonable, they know how to challenge it in the court of law. In fact, we

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are making it more transparent, we are making it more rule based and more reason based. [ Emphasis supplied] 27.08.2010 The 2010 Bill as passed by Rajya Sabha is debated in the Lok Sabha and passed. 26.09.2010 The 2010 Bill received the assent of the President of India. 27.09.2010 The Foreign Contribution (Regulation) Act, 2010 (Act No. 42 of 2010) (hereafter referred to as the 2010 Act) is notified in the Gazette of India Extraordinary Part II Section I. A true and correct Gazette copy of the Foreign Contribution (Regulation) Act, 2010 is hereto marked and annexed as ANNEXURE P5

29.04.2011

The Central Government by Gazette Notification S.O. 909(E) appointed 01.05.2011 as the date on which the provisions of the 2010 Act shall come into force.

29.04.2011

The Central Government in exercise of the powers conferred by Section 48 of the 2010 Act published the Foreign Contribution (Regulation) Rules, 2011 vide Gazette notification vide G.S.R. 349(E). The said rules came into force on the same day as the 2010 Act. Rule 3 is relevant for the purpose of this writ petition, which reads as follows:. 3. Guidelines for declaration of an organization to be of a political nature, not being a political party.- The central Government may specify any organization as

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organization of political nature on one or more of the following grounds: (i) organization objectives in having its avowed political of Memorandum

Association or bylaws: (ii) any Trade Union whose objectives include activities for promoting political goals: (iii) any voluntary action group with objectives of a political nature or which participates in political activities; (iv) front or mass organizations like Students Unions, Workers Unions, Youth Forums and Womens wing of a political party; (v) organization of farmers, workers, students, youth based on caste, community, religion, language or otherwise, which is not directly aligned to any political party, but whose objectives, as stated in the Memorandum of Association or activities gathered through other material evidence, include steps towards advancement of political interests of such groups; (vi) any organization, by whatever name called, which habitually engages itself in or employs common methods of political action like bandh or hartal, rasta roko, rail roko or jail bharo in support of public causes. A true and correct copy of the Foreign Contribution (Regulation) Rules 2011 is hereto marked and annexed as ANNEXURE P6. 01.05.2011 The Foreign Contribution (Regulation) Act, 2010 & the Foreign Contribution (Regulation) Rules, 2011 came into force. Consequently, the earlier act, viz., the Foreign Contribution (Regulation) Act, 1976 was repealed.

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04.08,2011 The Petitioner filed Writ Petition (Civil) No. 5793 of 2011 under Article 226 of the Constitution challenging the constitutional validity and ultravires nature of Rules 5 (1) & 5(4) of the 2010 Act and 3 (i), 3(v) and 3(vi) of the Foreign Contribution (Regulation) Rules, 2011. True copy of the said Writ Petition (C) No. 5793/2011 along with Index is hereto marked and annexed as ANNEXURE P7. 11.8.2011 Writ Petition (Civil) No. 5793/2011 came up for hearing. The same day, High Court heard the Petitioner and reserved the judgment. 16.9.2011 The High Court dismissed the writ petition, upholding validity of the impugned provisions. . 11.2011 Hence, the Special Leave Petition against the judgment and order dated 16.9.2011 passed by the High Court of Delhi at New Delhi in Writ Petition (C) No. 5793 of 2011.