The Bombay High Court yesterday granted interim relief to Lawyers Collective, the NGO founded by Senior Advocates Indira Jaising and Anand Grover..In November last year, the Ministry of Home Affairs had cancelled the license of Lawyers Collective (LC) under the Foreign Contribution Regulation Act, 2010. Prior to that, a show cause notice was issued in May, preventing the NGO from receiving foreign funding for six months..The Home Ministry’s order dated November 27, apart from cancelling LC’s registration certificate, also sought to freeze its FCRA accounts, as well as “other accounts to which the money has flown out of foreign contribution”. Further, it was ordered that the NGO’s assets be disposed of as per Section 22 of the FCRA Act, through the Charity Commissioner of Maharashtra..The NGO went on to protest the order, calling it “mala-fide” and “bad in law”. A representation from LC states among other things,.“LC reiterates that the current proceedings under FCRA, including the latest cancellation order, are only a continuation of the harassment and persecution of the organisation, especially of its two trustees, Ms. Indira Jaising and Mr. Anand Grover, Senior Advocates, perpetrated by the Government, over last one year..Both Ms. Jaising and Mr. Grover have been and are continuing to take up sensitive cases, in their professional capacity, against the powerful leaders of the present ruling establishment… LC is exploring all legal options to challenge the cancellation order and will take necessary action in an appropriate time.”.Pursuant to this, a first appeal was filed in the Bombay High Court earlier this month, through law firm DSR Legal. When the matter came up for hearing before Justice MS Sonak yesterday, the judge was inclined to grant an interim stay on the Home Ministry order, insofar as the freezing of LC’s non-FCRA accounts was concerned..Appearing for LC, senior counsel Aspi Chinoy submitted that under Section 15 of the FCRA Act, only foreign contribution or assets created by foreign contribution vest in the prescribed authority, and therefore, there was no basis to order the freezing of non-FCRA accounts. He also argued that the NGO’s assets could not be disposed of under Section 22 of the Act, since it has neither ceased to exist nor become defunct. Section 22 states,.“22. Disposal of assets created out of foreign contribution – Where any person who was permitted to accept foreign contribution under this Act, ceases to exist or has become defunct, all the assets of such person shall be disposed of in accordance with the provisions contained in any law…and in the absence of such law, the Central government may…specify that all such assets be disposed of by such authority, as it may specify…”.Additional Solicitor General Anil Singh, appearing for the Centre, argued that LC received and spent foreign contributions for activities not listed in their objectives. He specifically pointed out that Anand Grover had spent the amounts received on travel expenses, when he was on duty as a United Nations Special Rapporteur. Singh also alleged that there was “mixing of foreign contribution with local/domestic funds”, which was in violation of Section 7 of the Act..Justice Sonak went on to rule that there was sufficient grounds for granting interim relief as far as disposal of assets under Section 22 was concerned. It was held,.“…at least prima facie, the direction for action under section 22 of the FCRA is in excess of jurisdiction. Further, the balance of convenience is also in favour of the appellants, as otherwise, pending the appeal all the assets of the appellants may be disposed of. Therefore, a case is made out for grant of interim relief staying the direction for action under section 22 of the FCRA.”.He also held that the allegation that there was mixing of foreign and domestic was vague..“On the basis of same, pending the hearing and final disposal of the appeal, it may not be proper to freeze practically all the bank accounts of the appellants and thereby, completely cripple its activities and functioning.”.However, the order states that LC’s FCRA accounts will stand frozen pending the disposal of the appeal. The NGO was also directed to maintain and file accounts for the amounts spent from its non-FCRA accounts each quarter..No sooner had the order been passed than the ASG sought a stay on it, in relation to the utilisation of non-FCRA funds. Justice Sonak, though, was not inclined to grant the same. He has given the parties sixteen weeks to file paper books, and posted the matter for final hearing..It will certainly be an interesting couple of months in the High Court as Lawyers Collective battles for its existence..Read the order:
The Bombay High Court yesterday granted interim relief to Lawyers Collective, the NGO founded by Senior Advocates Indira Jaising and Anand Grover..In November last year, the Ministry of Home Affairs had cancelled the license of Lawyers Collective (LC) under the Foreign Contribution Regulation Act, 2010. Prior to that, a show cause notice was issued in May, preventing the NGO from receiving foreign funding for six months..The Home Ministry’s order dated November 27, apart from cancelling LC’s registration certificate, also sought to freeze its FCRA accounts, as well as “other accounts to which the money has flown out of foreign contribution”. Further, it was ordered that the NGO’s assets be disposed of as per Section 22 of the FCRA Act, through the Charity Commissioner of Maharashtra..The NGO went on to protest the order, calling it “mala-fide” and “bad in law”. A representation from LC states among other things,.“LC reiterates that the current proceedings under FCRA, including the latest cancellation order, are only a continuation of the harassment and persecution of the organisation, especially of its two trustees, Ms. Indira Jaising and Mr. Anand Grover, Senior Advocates, perpetrated by the Government, over last one year..Both Ms. Jaising and Mr. Grover have been and are continuing to take up sensitive cases, in their professional capacity, against the powerful leaders of the present ruling establishment… LC is exploring all legal options to challenge the cancellation order and will take necessary action in an appropriate time.”.Pursuant to this, a first appeal was filed in the Bombay High Court earlier this month, through law firm DSR Legal. When the matter came up for hearing before Justice MS Sonak yesterday, the judge was inclined to grant an interim stay on the Home Ministry order, insofar as the freezing of LC’s non-FCRA accounts was concerned..Appearing for LC, senior counsel Aspi Chinoy submitted that under Section 15 of the FCRA Act, only foreign contribution or assets created by foreign contribution vest in the prescribed authority, and therefore, there was no basis to order the freezing of non-FCRA accounts. He also argued that the NGO’s assets could not be disposed of under Section 22 of the Act, since it has neither ceased to exist nor become defunct. Section 22 states,.“22. Disposal of assets created out of foreign contribution – Where any person who was permitted to accept foreign contribution under this Act, ceases to exist or has become defunct, all the assets of such person shall be disposed of in accordance with the provisions contained in any law…and in the absence of such law, the Central government may…specify that all such assets be disposed of by such authority, as it may specify…”.Additional Solicitor General Anil Singh, appearing for the Centre, argued that LC received and spent foreign contributions for activities not listed in their objectives. He specifically pointed out that Anand Grover had spent the amounts received on travel expenses, when he was on duty as a United Nations Special Rapporteur. Singh also alleged that there was “mixing of foreign contribution with local/domestic funds”, which was in violation of Section 7 of the Act..Justice Sonak went on to rule that there was sufficient grounds for granting interim relief as far as disposal of assets under Section 22 was concerned. It was held,.“…at least prima facie, the direction for action under section 22 of the FCRA is in excess of jurisdiction. Further, the balance of convenience is also in favour of the appellants, as otherwise, pending the appeal all the assets of the appellants may be disposed of. Therefore, a case is made out for grant of interim relief staying the direction for action under section 22 of the FCRA.”.He also held that the allegation that there was mixing of foreign and domestic was vague..“On the basis of same, pending the hearing and final disposal of the appeal, it may not be proper to freeze practically all the bank accounts of the appellants and thereby, completely cripple its activities and functioning.”.However, the order states that LC’s FCRA accounts will stand frozen pending the disposal of the appeal. The NGO was also directed to maintain and file accounts for the amounts spent from its non-FCRA accounts each quarter..No sooner had the order been passed than the ASG sought a stay on it, in relation to the utilisation of non-FCRA funds. Justice Sonak, though, was not inclined to grant the same. He has given the parties sixteen weeks to file paper books, and posted the matter for final hearing..It will certainly be an interesting couple of months in the High Court as Lawyers Collective battles for its existence..Read the order:
