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Home Ministry termination order of Centre For Policy Research’s FCRA Registration

(News Trust of India) : The Centre for Policy Research (CPR) no longer holds the registration under the Foreign Contribution Regulation Act (FCRA) as it has been canceled by the Ministry of Home Affairs (MHA). The policy think tank obtained confirmation of this termination order on January 10.

This announcement from the ministry occurred 11 months after the original suspension of CPR’s FCRA license. The suspension, which was put in place on February 27 of the previous year, was justified due to a violation and lasted longer than the originally specified 180 days.

The decision by the central authorities came after an income tax survey was undertaken on the premises of CPR in 2022. MHA authorities stated that important documented evidence, showing the improper use of foreign cash by CPR, came to light during the Income Tax searches.

In a statement to the Delhi High Court, the ministry argued that CPR had been directing foreign funding towards “unfavorable purposes,” claiming that these funds were being redirected to other organizations. A spokesperson mentioned that putting foreign monies obtained under FCRA into accounts that are not designated is considered a breach of FCRA.

CPR, in turn, went to court to contest the Income Tax department’s decision to cancel the tax exemption previously given to the think tank. CPR reps mentioned thinking about legal alternatives due to the recent FCRA registration revocation decision from the MHA.

The organization contended that their operations had considerably suffered in the aftermath of the government’s decisions on FCRA and Income tax in recent months. In the top court, CPR alleged that the MHA’s decision on FCRA lacked due scrutiny.

CPR’s official statement on the cancellation called the rationale of MHA’s decision as “incomprehensible” and “disproportionate.” The statement emphasized that various justifications offered by the ministry challenged the fundamental functioning of a research institution like CPR, connecting the posting of policy studies on their website with current affairs broadcasting.

The research tank confirmed its resolve to pursue remedy through all possible means, emphasizing conformity with the law and full collaboration throughout the process.

Meanwhile, prominent Congress politician Shashi Tharoor expressed his disdain of the MHA’s decision, labeling it a “shame.” Tharoor said that independent think-tanks add to India’s legitimacy among democracies worldwide, and the government’s actions against CPR would tarnish India internationally.

On the subject of FCRA, the Foreign Contribution Regulation Act (FCRA), 2010, is defined as law combining regulation and restriction addressing “the acceptance and utilization of foreign contribution or foreign hospitality by certain individuals or associations or companies.”

The Act intends to ban the acceptance and usage of foreign contributions or foreign hospitality for activities detrimental to national interest. As per government FCRA requirements, registered firms must produce online annual reports, containing income and expenditure statements, receipt and payment accounts, and balance sheets within nine months after the financial year’s conclusion.

Any entity or “person” qualified to accept foreign funds must possess “a definite cultural, economic, educational, religious, or social program” and permission under FCRA rules from the Centre. The law emphasizes that the government should be satisfied that accepting foreign contributions does not compromise national sovereignty and integrity, public interest, freedom or fairness of elections, friendly relations with foreign states, or harmony between religious, racial, social, linguistic, or regional groups.

With the 2020 change to FCRA, the government noticed an almost doubled yearly influx of foreign donations between 2010 and 2019. It also highlighted cases where receivers failed to utilize donations for the registered or allowed purposes under the Act.

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