Paragraph numbers below are the court’s original numbering, recovered from the source text.
48. Concededly, Section 8 permits the recipient of foreign contribution to utilise only specified portion thereof for administrative purposes, to the extent permissible. As per Section 8, the administrative expenses qua foreign contribution received by the registered person ought not to exceed twenty per cent (instead of fifty per cent under the unamended provision) of such contribution in the concerned financial year. The proviso to Section 8(1), however, enables spending beyond twenty per cent towards administrative expenses with prior approval of the Central Government. Be it noted, the validity of amended Section 8 is not put in issue in these petitions.
49. On conjoint reading of Sections 7 and 8, as amended, the legislative intent of mandating utilisation of foreign contribution by the recipient itself for the purposes for which it had been permitted gets reinforced. Additionally, Sections 12(4)(b) and 18 of the 2010 Act also reinforce such a view — which predicates that the person who has been granted certificate of registration or given prior approval under the Act, is obliged to give intimation to the Central Government and such other authorities as may be specified by the Central Government as to the amount of each foreign contribution received by it, the source from which and the manner in which such foreign contribution was received, and the purposes for which, and the manner in which such foreign contribution was utilised by him. This information may facilitate inquiry mechanism and to reassure that the foreign contribution accepted by the person has been utilised for definite purposes permitted by the competent authority. Any breach of this stipulation may entail in penal action under the Act.
50. It was vehemently urged before us that since the transferee would also possess certificate of registration and bound by the provisions of the 2010 Act, it would serve no legitimate purpose by prohibiting transfer of foreign contribution to such person. Accepting this argument would be completely glossing over the legislative intent for which the amendment has been effected. The legislative intent is to introduce strict dispensation qua the recipient of foreign contribution to utilise the same “itself” for NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.] the purposes for which it has been permitted as per the certificate of registration or permission granted under the Act by the Central Government. In addition, by the same Amendment Act, utilisation of foreign contribution for administrative purpose by the recipient has been lowered to twenty per cent only with a view to ensure maximum spending on the purposes for which the foreign contribution has been accepted by the recipient having certificate of registration.
51. Absent such stringent provision, some of the recipient organisations were reportedly indulging in successive chain of transfers to other organisations, thereby creating a layered trail of money and also utilisation of funds towards administrative costs of successive transfers upto fifty per cent leaving very little funds for spending on the purposes for which it was permitted. Hence, providing complete restriction on transfer simplicitor, was the just option to fix accountability of the recipient organisation and maximise utilisation for the permitted purposes. Such being the avowed objective and purpose of the amendment, the challenge to the amended Section 7 must fail.
52. Be that as it may, the fact that earlier transfer of foreign contribution was permitted as per the unamended provision, that by itself cannot be the basis to challenge the validity of the amended provision. For, it is open to the Parliament to change the benchmark of restriction from higher standard to lower standard or vice versa on the basis of the exigencies and experience gained during the implementation of the applicable provision at the relevant time.
53. Indubitably, foreign contribution is qualitatively different from foreign investment. Receiving foreign donation cannot be an absolute or even a vested right. By its very expression, it is a reflection on the constitutional morality of the nation as a whole being incapable of looking after its own needs and problems. The question to be asked is: “in normal times”, why developing or developed countries would need foreign contribution to cater to their own needs and aspirations? Indisputably, the aspirations of any country cannot be fulfilled on the hope (basis) of foreign donation, but by firm and resolute approach of its own citizens to achieve the goal by sheer dint of their hard work and industry. Indeed, charitable activity is a business. Receiving contribution within India to do charitable activity can be and is being regulated differently. It is not possible to have a similar approach relating to foreign contribution from foreign source. In short, no one can be heard to claim a vested right to accept foreign donation, much less an absolute right.
54. We say so because the theory of possibility of national polity being influenced by foreign contribution is globally recognised. For, foreign contribution can have material impact in the matter of socio-economic structure and polity of the country. The foreign aid can create presence of a foreign contributor and influence the policies of the country. It may tend to influence or impose political ideology. Such being the expanse of the effect of foreign contribution coupled with the tenet of constitutional morality of the nation, the presence/inflow of foreign contribution in the country ought to be at the minimum level, if not completely eschewed. The influence may manifest in different ways, including in destabilising the social order within the country. The charitable associations may instead focus on donors within the country, to obviate influence of foreign country owing to foreign contribution. There is no dearth of donors within our country.
55. Pertinently, the 1976 Act came to be repealed by the 2010 Act, as it had become necessary to do so because of the experience gained that in the name of foreign contribution, attempts were made by unscrupulous entities to disturb the economy and sovereignty of our country. That being the underlying reason, it must follow that the legislative intent behind the Act and constant effort of the Government and of the Parliament is to discourage foreign contribution generally, but allow it for specific definite purposes mentioned in Section 11 of the Act; and for which, the person receiving or accepting foreign contribution is obliged to obtain a certificate of registration under the Act or prior permission, as the case may be. Further, such person is obligated to comply all the stipulations attached to the certificate of registration or prior permission, without any exception.
56. Apparently, receiving “foreign exchange” is itself completely prohibited and made subject to exceptions provided for in terms of the Foreign Exchange Management Act, 1999137. On conjoint reading of the provisions of the 1999 Act and the regulatory mechanism provided for in the 2010 Act, it is a clear pointer to the strict regime to be followed by all concerned for allowing inflow of “foreign contribution” (donation) in the manner prescribed and its utilisation only for definite purposes permitted by the competent authority.
57. We fail to understand as to how such a provision (amended Section 7) can be regarded as discriminatory or so to say vague or 137 for short, “the 1999 Act” NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.] irrational much less manifestly arbitrary. The restriction therein applies to a class of persons who are permitted to accept foreign donation for being utilised by themselves for the definite purposes, without any discrimination and it is so done to uphold the objective of the Principal Act. Thus, there is clear intelligible differentia with a direct nexus sought to be achieved with the intent of the Principal Act. Such strict regime had become inevitable because of the experience gained by the concerned authorities over a period of time, including about the abuse of the earlier dispensation under the unamended provision.
58. The change not only completely prohibits transfer, but also enhances the efficacy of the foreign contribution by mandating utilisation thereof by the person granted certificate of registration itself, for the purposes for which it had been accepted in terms of the certificate of registration or prior permission granted under the Act, as the case may be, including upto prescribed administrative expenses. This restriction inevitably fixes the accountability of the recipient organisation and mandating maximum utilisation by itself for permitted purposes. This is the procedure established by law. It can neither be said to be arbitrary nor discriminatory much less manifestly arbitrary — within the meaning of Article 14 or impinging upon Article 21 of the Constitution. As a matter of law, since the subject Act deals with a distinct class of persons (accepting/receiving foreign contribution) and it is founded on an intelligible differentia having object sought to be achieved by the Principal Act, it fulfils the test predicated in Shayara Bano138. For the same reason, the amended provision under challenge is neither capricious, irrational or lacking determining principle, nor suffers from the vice of excessiveness and being disproportionate.
59. We need to bear in mind that there is presumption that the Parliament understands and reacts to the needs of its own people as per the exigencies and experience gained in the implementation of the law. Mere plea of inconvenience is not enough to attract the constitutional inhibition. The Courts ought not to adopt a doctrinaire approach in construing the amended provisions and undermine the legislative intent of strengthening the regulatory mechanism concerning foreign contribution. The legislature enjoys considerable latitude while exercising its wisdom on the basis of inputs collated from different quarters139. 138supra at Footnote No.18 139see Ombalika Das vs. Hulisa Shaw (supra at Footnote No.79) There is intrinsic evidence to indicate that the change effected by the amendments is to serve the legitimate Government purpose and has a rational nexus to the object of the Principal Act and the amendments, and that the pre-amendment dispensation (unamended Section 7) was not sufficient to effectively regulate the acceptance and utilisation of foreign contribution as predicated by the Principal Act.
60. Reliance placed by the petitioners on the dictum in Shreya Singhal140 and K.S. Puttaswamy141 to urge that it is open to the Court to test the amendment on the touchstone of manifestly arbitrary, need not detain us in light of the conclusion noted hitherto, keeping in mind the legislative history and the compelling necessity to adopt strict regime for prohibiting “transfer” of foreign contribution and insistence of “utilisation” thereof by the recipient himself/itself. For the same reasons, the dictum in Anuradha Bhasin142 that the underlying consideration of appropriateness, necessity and the least restrictive measure compliant law, will also be of no avail.
61. The argument that this Court in the case of INSAF143,while dealing with the provisions of the 1976 Act had recognised the absolute right to receive foreign contribution is misplaced and misreading of that decision. For, the said decision examined the arguments pursued before the Court in the context of challenge to the validity of Section 5(1) and 5(4) of the 2010 Act and Rule 3(i), 3(v) and 3(vi) of the 2011 Rules as being violative of Articles 14, 19(1)(a), 19(1)(c) and 21 of the Constitution. The provisions in Rule 3(v) and 3(vi) were read down to mean that the expression “political interests” occurring therein be construed to mean that it would apply only to those organisations which have connection with active politics or take part in party politics. Strikingly, even in this decision the Court noted the object sought to be achieved by the 2010 Act. To wit, to ensure that Parliamentary institutions, political associations and academic and other voluntary organisations as well as individuals working in the important areas of national life should function in a manner consistent with the values of a sovereign democratic republic without being influenced by foreign contributions or foreign hospitality. The Court went on to observe that long title of the Act makes it clear that the 140 supra at Footnote No.117 141 supra at Footnote No.7 142 supra at Footnote No.21 (paras 154-159) 143 supra at Footnote No.22 NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.] regulation of acceptance and utilisation of foreign contribution is for the purpose of protecting “national interests” and to prohibit organisations of a political nature from receiving foreign contributions.
62. That being the underlying purpose for which the Act has been enacted, whilst interpretating the amended provisions, we cannot be oblivious to the concern expressed by the Parliament, about the state of affairs and the fallout of the implementation of the dispensation enunciated under the unamended Act. As the Parliament took a well informed and conscious decision to alter that position — to make it a strict regulatory regime of not permitting the recipient of foreign contribution to transfer the funds to third party for the reasons weighed with it, it must follow that the provision is in the interests of the sovereignty and integrity of the country, public order and in the interests of the general public.
63. The question posed to us was: whether such restriction can be said to be reasonable restriction or impinges upon the right of any person? While examining the issue as to whether the amended provision is a reasonable restriction, the Court cannot be oblivious to the concern of the Parliament/Legislature backed by the past experiences including cancellation of registration of substantial number of registration certificates after due inquiry and for tangible reasons owing to abuse and misutilisation of foreign contribution (donation); and especially when receipt or acceptance of foreign exchange or be it foreign contribution, is otherwise understood to be ordinarily prohibited. For, the “foreign exchange” and more so “foreign contribution” can be received or brought within the territory of India only as per the dispensation provided for in the municipal law. There can be no absolute right in that regard. The fact that transfer was permitted under the unamended Section 7, it does not follow that the Parliament is not competent to amend that dispensation to make it more stringent, including to completely prohibit the inflow of foreign contribution. The amended provision is not to completely prohibit inflow of foreign contribution, but is a regulatory measure to permit acceptance by registered persons or persons having prior permission to do so with condition that they must themselves utilise the entire contribution including for administrative expenses within the limits provided under Section 8 of the Act. The subject enactment is essentially conceived in the interests of public order and also general public as the intent is to prevent misuse and misutilisation of foreign contribution coming from foreign sources to safeguard the values of a sovereign democratic republic.
64. Thus understood, it is a reasonable restriction as it does not hinder with the right of forming associations as well as to engage in business of charity. Being a regulatory measure necessitated because of past experience and to uphold the intent of the Principal Act, insisting for utilisation, spending of foreign contribution by the recipient itself cannot be said to be irrational, arbitrary, discriminatory, or unreasonable restriction as such.
65. The restriction or complete prohibition on transfer to third party, by no standards deprive acceptance of foreign contribution and utilisation thereof in the manner permitted for definite purposes, such as cultural, economic, educational or social programme. Such a provision must be understood as being procedure established by law in the interests of the general public and in the interests of sovereignty and integrity of the country, including public order. Resultantly, there is no infraction even of Article 19(1)(c) or 19(1)(g) of the Constitution as urged by the writ petitioners before us, including Articles 14 and 21 of the Constitution. Consistent with this view, we must reject the challenge to the amended Section 7 on all counts.
66. For the same reason, the argument of the writ petitioners about lack of rational nexus with the object sought to be achieved by the Principal Act much less the Amendment Act, must also fail. The rationale is of larger public interests and more particularly to obviate adverse impact on the economy, public order, sovereignty and integrity of the country. Such amendment has been necessitated because of the past experience consequent to implementation of the unamended Section 7 of the 2010 Act. It is so highlighted in the objects and reasons and the introduction of the Amendment Act. It can also be culled out from the debates in the Parliament whilst considering the Amendment Bill in the respective Houses. To overcome the mischief and to enhance transparency and accountability regarding acceptance and also utilisation of foreign contribution which is quite substantial every financial year having proliferating effect on the economy of the nation, it had become necessary to enact amended Section 7. In other words, there is a clear rationale behind the amendment which is consistent with the purpose of the Principal Act and the object sought to be achieved under the enactments. The fact that unamended provision was less restrictive, cannot be the basis to test the constitutional validity of the provision on the touchstone of Article 19(1)(c) or 19(1)(g) or Articles 14 and 21 of NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.] the Constitution. The amended Section 7, being plain and clear and having nexus with the object sought to be achieved and is necessitated because of sovereignty and integrity of India or security of the State, public order and in the interests of the general public. It is unfathomable as to how the amended provision can be regarded as unconstitutional on any parameter.
67. It is urged that Rule 24 of the 2011 Rules came to be deleted with effect from 10.11.2020. This rule enabled the registered organisations to transfer foreign contribution to any unregistered person in the manner provided therein. However, in light of amendment to Section 7 prohibiting transfer of foreign contribution to any person, the need for the dispensation predicated in Rule 24 had become non-existent. In other words, as per amended Section 7, there is no need to continue Rule 24 on the statute book and its continuance for some time would also make no difference in the wake of express prohibition in amended Section 7 of the 2010 Act. Validity of Section 12(1A) and Section 17(1)
68. Section 12(1A) has been inserted by Act 33 of 2020, which envisages that every person who makes an application under sub-Section (1) of Section 12 is obliged/required to open FCRA account in the manner specified in Section 17 and mention details of such account in his application. Section 17, in particular sub-Section (1) as amended, mandates that every person who had been granted certificate or prior permission under Section 12 shall receive foreign contribution only in an account designated as FCRA account in the specified bank. The unamended Sections 12 and 17 did not impose such restriction. Notably, as per the new regime foreign remittances are being received through SWIFT platform by international banking wherein certain mandatory fields are required to be captured apart from other details transaction wise. Further, foreign remittances do not have structured framework, including disclosures regarding purposes. All these deficiencies will stand resolved thereby enhancing the monitoring mechanism in real-time basis, remittance wise by adopting the new dispensation predicated in the amended provisions.
69. Once again, the need to strictly regulate the inflow of foreign funds and to oversee utilisation thereof for the purposes for which it has been received having been recognised and being the rationale behind the Amendment Act, including owing to the experience regarding abuse of the regime under the unamended provision, the challenge to such amendment cannot be taken forward.
70. There is force in the argument of the respondents that Section 17 came to be amended aftermath realisation of clear and discernible lacunae had cropped in due to the presence of FCRA accounts of scores of registered organisations, in different scheduled banks across the country. The challenge became more pronounced due to doubling of foreign contribution inflow in the last decade which had impacted the efficiency of monitoring and achieving the object of the Principal Act. The amended provision now mandates that FCRA accounts of all the registered persons/organisations are required to be opened in one particular branch in the country providing for essential information and fields, thereby ensuring a complete and transparent check on the inflow and utilisation of foreign contribution towards a single point source on real-time basis.
71. The fact that earlier FCRA account could be opened in any scheduled bank, cannot preclude the Parliament from legislating a law which requires inflow of foreign contribution in some other manner specified by law. Merely because the framework of acceptance of foreign contribution had been changed cannot be the basis to question the validity of the amended provisions. Introducing change for the betterment of governance is the prerogative and wisdom of the Parliament. The FCRA account operators cannot claim right of continuity of a deficient and flawed framework. Ordinarily, convenience of business and persons engaged in doing business must be uppermost in the mind of the Parliament/Legislature — to effectuate the goal of ease of doing business. However, the strict regime had become essential because of the past experience of abuse and misutilisation of the “foreign contribution” and cancellation of certificates of as many as 19,000 registered organisations on the ground of being grossly non-compliant. Despite such cancellation of large number of certificates of registration, until December 2021 there were reportedly 22,762 FCRA registered organisations presumably compliant with new dispensation. Further, as many as 12,989 organisations have applied for the renewal of the FCRA licence between 30.09.2020 and 31.12.2021. And as many as 5,789 organisations had not applied for renewal of FCRA licence, whose FCRA licence has ceased to be valid. A fortiori, it would certainly justify the need to have a holistic approach to ensure that the objective of the NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.] Principal Act is fulfilled, namely, of strict regulation of the inflow and utilisation of foreign contribution for the purposes for which it is so permitted, such as only cultural, economic, educational or social programme.
72. In fact, the Parliament must be credited with for having taken recourse to corrective dispensation for eradicating the mischief, which any sovereign country can ill-afford. The Parliament is supreme and has a final say in matters of legislation when it reflects on alternatives and choices with inputs from different quarters, with a check in the form of democratic accountability and a further check by the Courts which exercise the power of judicial review144. We find force in the argument that it had become necessary for the Parliament to step in and provide a stringent regime for effectively regulating the inflow and utilisation of foreign contribution. Hence, there had been legitimate goal for amending the subject provisions of acceptance of funds through one channel. Concededly, despite the requirement of opening FCRA account in the designated bank, it is open to the organisation to utilise the amount so received in the FCRA account through multiple accounts in the scheduled branches. In that sense, it is a balanced approach.
73. A priori, opening of main FCRA account in the designated bank as per the law made by the Parliament in that regard, cannot be brushed aside on the specious argument of some inconvenience being caused to the registered associations145. Assuming that some inconvenience is likely to be caused to few applicants, but the constitutionality of a statute cannot be assailed on the basis of fortuitous circumstances and more so when it being only a one-time exercise to ensure inflow of foreign contribution through one channel only, being a precondition for grant of permission. There is no restriction regarding utilisation of the funds only through that (primary) FCRA account. For, it is open to the recipient to operate multiple accounts in other scheduled banks for its utilisation. 144 Dr. Ashwani Kumar (supra at Footnote No.47) 145 In Laxmi Khandsari (supra at Footnote No.31) and All India Council for Technical Education (supra at Footnote No.32), this Court had expounded that on the plea of individual hardships, Court cannot interfere with policy matters (and in present cases a just law made by Parliament).
74. As a matter of law, the validity of the amendments must be tested on the touchstone of tenets underlying Articles 14, 19 and 21 of the Constitution. The permission is a precondition for acceptance and utilisation of foreign contribution. Such persons are a separate class and engage in specified activity. It cannot be a usual or ordinary business for everyone and anyone wanting to accept foreign contribution. Permitting inflow of foreign contribution, which is a donation, is a matter of policy of the State backed by law. In this case, it is governed by the 2010 Act as amended. It is open to the State to have a regime which may completely prohibit receipt of foreign donation, as no right inheres in the citizen to receive foreign contribution (donation).
75. The provision such as Section 12(1A) and Section 17(1) introduced by the Amendment Act, is a holistic approach adopted by the Parliament to provide for strict regulatory measure and for ensuring transparency and accountability in the matter of foreign contribution. Notably, there was unanimity amongst the members of both the Houses cutting across party lines to have such a strict regime as indiscriminate receipt/inflow and more so utilisation of foreign contribution had been threatening the sovereignty and integrity of the country itself. Being a matter of security of the State, public order and in the interests of the general public, it is not open to question the validity of such a law on the touchstone of Article 19(1)(c) or 19(1)(g) of the Constitution. It is not a provision to completely prohibit forming of the associations or engaging in business of charity as such. It is a provision for regulating the manner of doing business more importantly, concerning foreign contribution.
76. Opening of main FCRA account in the designated bank, as has been rightly contended by the respondents, is only a one-time exercise and for which instructions and protocols have been issued by the competent authority, not to insist for physical presence for complying with the formalities. It can be organised even at the local branches of the designated bank in the manner specified in the instructions issued in that regard. Moreover, the provision does not prohibit the person/ registered association from opening multiple accounts in other scheduled banks, wherein the amount received in (primary) FCRA account in NDMB can be transferred; and from where day-to-day activities can be then carried on by them. In any case, the designated bank being NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.] conscious of its banking obligations and to provide best services to the registered associations, have issued instructions (Standard Operating Procedure) for making it convenient to open FCRA account in NDMB as also to operate the foreign contribution received in such an account. If any further improvement in the operational convenience is required, it is open to the petitioners and all other interested persons to request the designated bank to improve upon such facility. However, merely because the registered association has been compelled to open FCRA account in the designated bank at the centralised location for receipt/inflow of foreign contribution from foreign source, it does not follow that such a requirement would be manifestly arbitrary or unreasonable. It is only a one-time exercise to be complied with for availing the permission accorded by the Central Government under the Act to be a certified association or person given permission to receive foreign contribution as a precondition.
77. The need to have only one entry point for the inflow of foreign contribution had been viewed by the Parliament as the best option for regulating the inflow of foreign contribution. This process is expected to increase the efficiency in continual supervision of the inflow of foreign contribution on real-time basis by the concerned Authorities and to enable them to take immediate corrective measures to deal with and pre-empt the impending threat perceived because of its volume including undesirable source of remittance. It is not open to the Court to have a second-guess approach in that regard.
78. In the context of the law made by the Parliament in the interests of the sovereignty and integrity of the country and security of the State, public order, as also in the interests of the general public, such a provision cannot be lightly viewed much less on the specious plea of manifestly arbitrary. The Parliament in its wisdom had deemed it essential to have such a provision because of the prevalent discernible circumstances referred to in the introduction of the Bill.
79. It was vehemently urged that there is lack of infrastructure at the designated bank and that the bank branch is manned only by 40 odd personnel. To buttress this plea, reference is made to the observation made by the Reserve Bank of India — that voluminous data on Foreign Remittances will put an extra financial burden on the Bank and increase its costs including divert focus on monitoring of suspicious transactions. This argument does not commend to us at all. In digital banking operations, it is not the head count dispensing physical services that would matter, but the effectiveness of the software is important. We are also not impressed by the plea that for organisations located in remote parts of the country, there would be impediments and for that reason, Section 7 violates test of fairness and reasonableness. In any case, respondent No.3 (SBI) has on affidavit explained as to the extent of measures taken for ensuring efficient servicing of FCRA accounts of all the registered associations/account holders. Respondent No.3 has also assured that if need arises, suitable corrective measures including to upgrade the facilities/services would be taken at its end. Suffice it to observe that the argument under consideration cannot be the basis to doubt the constitutional validity of the provisions in the form of Section 12(1A) and Section 17(1), as amended vide the Amendment Act. Needless to underscore that respondent No.3 has stated on affidavit before this Court that FCRA accounts opened in its designated branch can be operated online on real-time basis without the need for physical presence of the account holder or its officials.
80. Having noted that the provision became necessary for efficient regulation of foreign contribution on real-time basis, it can neither be said to be manifestly arbitrary nor irrational much less without legitimate objective of the State. Accordingly, we have no hesitation in negating the challenge to these provisions as being violative of Articles 14, 19 and 21 of the Constitution.
81. The fact that the registered associations were already complying with the statutory formalities of furnishing of accounts, intimation, audit and disposal of assets to the satisfaction of the concerned Authorities, it would not follow that the Parliament/Legislature is denuded of its power of changing the regulatory mechanism or framework to make it more effective and to make it real-time regarding the inflow or receipt of foreign contribution and utilisation thereof for the purposes for which it has been so permitted. Accepting the argument of the registered associations would not only be undermining the legislative intent, but also disregarding the object sought to be achieved by the Principal Act. NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.]
82. The argument of compelling necessity may have arisen for our consideration only if we were to find that the dispensation provided in the amended provisions is in the nature of complete prohibition to form association or to engage in business. As mentioned earlier, these provisions are only for effective regulatory measures concerning and limited to foreign contribution, in the larger public interests, public order, and more particularly for safeguarding the sovereignty and integrity of the country. Taking any other view would entail in undermining the legislative intent and cannot be countenanced. Validity of Section 12A
83. Reverting to the challenge to the insertion of Section 12A vide the Amendment Act of 2020, it mandates that the person concerned who seeks prior permission or prior approval under Section 11, or makes an application for grant of certificate under Section 12, including for renewal of certificate under Section 16, to provide as identification document, the Aadhaar number of all its office bearers or Directors or other key functionaries. The Statement of Objects and Reasons of the Amendment Act are testimony about the past experience of abuse of foreign contribution receipts and spending on activities not connected with the purposes for which it was so permitted. It had been noticed that the inflow of foreign contribution had almost doubled between the years 2010 and 2019 and many of the registered associations had failed to comply with basic statutory formalities necessitating cancellation of certificates of registration of more than 19,000 registered organisations. This is a staggering (substantial) number indicative of gross violations by large number of registered associations. More so, this amendment had been necessitated to safeguard the sovereignty and integrity of the country, and public order, including in the interests of the security of the State and of the general public. It is a law made by the Parliament which is competent to make such a law concerning the activities related to foreign donations and more particularly about its acceptance in prescribed manner and utilisation for the purposes defined in the certificate/ permission granted by the competent authority. It has a legitimate purpose and nexus sought to be achieved with the objective underlying the Principal Act and the subject amendment. It is not open to argue that associations desirous of obtaining certificate of registration under this Act need not furnish official identification document pertaining to its key functionaries.
84. Regardless of the above, the provision (Section 12A) envisages that a copy of the Passport can also be provided as identification document of all its office bearers or Directors or other key functionaries or Overseas Citizen of India Card, in case of a foreigner. The underlying purpose of this provision is merely to identify the key functionaries of the registered association so that they can be made accountable for violations, if any. We are of the view that as the Passport in case of a foreigner is accepted as sufficient identification document, there is no reason why such Passport of Indian national cannot be relied upon for the same purpose. Thus understood, the challenge to this provision being unreasonable need not detain us nor is required to be taken any further. Whereas, we hold that the provision needs to be construed as permitting furnishing of the Indian Passport of the key functionaries of the applicant who are Indian nationals, for the purpose of their identification.
85. Having said this, it is not necessary to dilate on other arguments pressed into service dealing with matters of privacy or the provisions under consideration being manifestly arbitrary.
86. For the view that we have taken, we do not wish to dilate on every single authority cited across the Bar as the view taken by us is in no way different than the principle expounded therein. Conclusion
87. To sum up, we declare that the amended provisions vide the 2020 Act, namely, Sections 7, 12(1A), 12A and 17 of the 2010 Act are intra vires the Constitution and the Principal Act, for the reasons noted hitherto. As regards Section 12A, we have read down the said provision and construed it as permitting the key functionaries/office bearers of the applicant (associations/NGOs) who are Indian nationals, to produce Indian Passport for the purpose of their identification. That shall be regarded as substantial compliance of the mandate in Section 12A concerning identification. NOEL HARPER & ORS. v. UNION OF INDIA & ANR. [A. M. KHANWILKAR, J.]
88. Accordingly, Writ Petition (Civil) Nos. 566 and 751 of 2021 are disposed of in the aforementioned terms. Writ Petition (Civil) No.634 of 2021 also stands disposed of. No order as to costs. Pending application(s), if any, are also disposed of. Bibhuti Bhushan Bose Writ Petitions disposed of. (Assisted by : Preetam Bharti, LCRA)