However, a CBI report filed in the Supreme Court said only 10 percent of 33 lakh NGOs have filed annual income and expenditure statements. On its part, the CAPART informed that it had blacklisted 718 NGOs for not following due process and not submitting accounting details, and that it had recommended lodging 159 FIRs against various NGOs for alleged misappropriation or misuse of funds. Taking a stern view of the Centre's failure to ensure any sort of accountability at all with such large sums of public money, the apex court made it clear that "mere blacklisting" of rogue organisations would not suffice, that civil and criminal action must be initiated against misappropriation of funds received by them from various government departments. The Centre has now sought some time from the Supreme Court to frame appropriate legislation 'to give more teeth' to regulations on NGOs, which means penal provisions will be included. Earlier, the Modi regime has sought to rein in foreign-funded NGOs like Greenpeace and Amnesty, drawing much flak from activists in various sectors for 'shooting the messenger'. The allegation is that the NDA government is seeking to bring such NGOs to heel to hide failures in protecting environment and human rights, that it perceives them to be following an agenda drawn up by rich countries to stall development in India. They have pointed to foreign funds being well utilised for rural development, children's welfare, construction of schools and colleges and research in the country. In turn, the government has said that actions like freezing Greenpeace's bank accounts were taken because it had broken tax laws and worked against India's economic interests.
What needs be remembered here is that the Congress-led UPA government in 2010 had enacted the Foreign Contribution Regulation Act (FCRA) in place of the 1976 law by the same name. Back in 1976 at the height of Emergency, the FCRA was enacted to restrict foreign funding to civil society groups. Later on, successive governments used this law to keep such groups under tight leash, but the UPA regime took the stand that foreign-funded NGOs must be prepared for more scrutiny. The FCRA 2010 ended the system of permanent registration of NGOs, requiring them to seek renewal of licence every five years. So when the first 5-year term ended in September 2015, the NDA regime at the Centre cancelled the registrations of more than 11,000 NGOs for not filing annual returns for 3 years in a row, while many among them were defunct or did not want to be registered. Since then, the Centre has been tweaking FCRA Rules, making it mandatory for all voluntary organisations to have dedicated accounts in preferably public sector or designated banks with core banking facilities, and that no NGO gets foreign funds under prior permission category more than once. In particular, the Union Home Ministry has declared that NGOs must make it clear that the foreign aid received by them "will not be used for any activities detrimental to national interest, likely to affect public interest, or likely to prejudicially affect the security, scientific, strategic or economic interest of the State." This has got activists questioning the government what it means by terms like 'national interest' and 'public interest' without defining these first. So the government's intent behind proposed FCRA changes will remain an issue that political parties will likely capitalise upon, even though both UPA and NDA have sought to rein in NGOs receiving foreign funds. The Supreme Court has now made it clear that when it comes to NGOs and VOs funded by public money, there can be no compromise either with transparency and accountability.