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SC Notice Doesnt Deter Govt, Uses Fin Bill Again To Amend Law To Allow Foreign Funding To Pol Parties

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SC Notice Doesnt Deter Govt, Uses Fin Bill Again To Amend Law To Allow Foreign Funding To Pol Parties

Already facing a Supreme Court notice on petition challenging amendments in law through money bill to legalise foreign funding to political parties, the government has once again sought to amend the repealed Foreign Contribution Regulation Act (FCRA), 1976, retrospectively through Finance Bill 2018.

This is seen as an attempt to wriggle out of legal wrangles that the BJP and Congress have got into over receiving foreign funds

The Delhi High Court had held the two parties guilty of receiving foreign funds from two subsidiaries of Vedanta, a UK-based company and issued contempt notice to the Ministry of Home Affairs (MHA) for not complying with its order.

Political parties are barred from receiving foreign funds under the Representation of the People Act and the FCRA. Facing a court case, in 2016, the government changed the definition of ‘foreign companies’ by amending the FCRA. This was done by moving the amendment as a Finance Bill, which cannot be blocked by the Rajya Sabha.

What is more, the amendment was made effective retrospectively. However, it only made valid the foreign donations received after 2010, the year when the 1976 Act was repealed and replaced with FCRA 2010.

Both BJP and Congress were allegedly receiving foreign funds for political activities from Vedanta from 2004 to 2012.

After a Delhi High Court notice, in an attempt to obtain relief for the two parties, the government has again proposed an amendment through the Finance Bill, 2018. It says, “Clause 217 of the Bill seeks to amend Section 236 of the Finance Act, 2016 which relates to amendment to sub-clause (vi) of clause (j) of sub-section (1) of Section 2 of the Foreign Contribution (Regulation) Act, 2010 …. effect from the 5th August, 1976 the date of commencement of the FCRA, 1976, which was repealed and re-enacted as the FCRA, 2010.”

In Part XIX of the list of amendments in the 2018 Finance Bill, the “Amendment to the Finance Act, 2016”, entry number 217, reads: “In Finance Act, 2016, in section 236, in the opening paragraph, for the words, figures and letter ‘the 26th September, 2010’, the words, figures and letter ‘the 5th August, 1976’ shall be substituted.”

Further, The Indian Express reported quoting an unnamed official, “After Foreign Direct Investment (FDI) norms were relaxed, there were anomalies regarding the definition of foreign companies under the FCRA which were not amended. After seeking legal opinion, it was decided to amend the 1976 Act in the 2018 finance Bill.”

The FCRA of 1976 defined a foreign company as one with over 50 per cent foreign ownership, thereby disallowing the companies owned by foreign nationals or Indian-origin people based abroad and with foreign citizenship to fund and influence political parties in India.

This was inconsistent with the view of the Finance and the Commerce Ministries, which treated companies based in India and having Indian directors and employees as Indian subsidiaries.

Brief background:

The earlier retrospective amendment in 2016 did not apply to donations prior to 2010 while the Delhi High Court had in 2014 held that the donations were illegal. On March 28, 2014, the high court had ordered the Election Commission and the ministry of home affairs (MHA) to look into the accounts of parties and take action within six months.

The matter dragged on. The Association for Democratic Reforms (ADR), the Delhi High Court moved a contempt petition in March 2017 against the Ministry of Home Affairs (MHA) pointing out that the directives of the High Court against the two political parties which received foreign funds were not complied with.

In October, 2017, the Delhi High Court bench of acting Chief Justice Gita Mittal and Justice C Hari Shankar gave further six months to MHA for complying with its 2014 judgment, which had found both parties flouting the FCRA norms by accepting donations from Indian subsidiaries of UK- based Vedanta Resources.

The MHA had sought extension of time till March 31, 2018 to comply with the court’s directions saying that the records were “voluminous in nature and a few decades old” hence it required more time to “collect, collate and then analyse them”.

Contesting the ADR’s contention that even after the lapse of three years the government remained in noncompliance with the judgment of the Delhi HC, the Centre argued that the ministry of corporate affairs was examining the share-holding patterns of the companies which have extended donations to the political parties.

After hearing the arguments the bench said it will give one last opportunity to the government and extended the time period by six months.

By the time six months were to be over, the Centre brought in the latest amendment.

ADR founder Jagdeep S Chhokar told India Legal/APN Live: “The contempt petition is still pending in the HC. Government lawyers have been seeking one adjournment after another, because they were trying to buy time to take care of the problem.”

“They (the government) seem to have come up with the solution: “make the amendment effective since 1976″. But the legal lacuna is that the 1976 Act was specifically repealed in 2010,” said Chhokar.

Calling it “patently illegal”, Chhokar said, “Question is how does one amend an Act that is dead. You can amend a law that is force but you can’t amend a law that does not exist.”

“In fact, if it is taken to its logical end, what they have done in the Finance Bill might land them in further trouble,” he added.

The Supreme Court in October 2017 had issued notice to the Centre on a plea by ADR challenging amendments to various statutes introduced through The Finance Act, 2017, and The Finance Act, 2016, both of which were passed as money bills, allegedly leading to illicit and foreign funding of political parties.

The statutes amended include the Income Tax Act, 1961, Representation of People’s Act, 1951, Reserve Bank of India Act, 1934, Foreign Contribution (Regulation) Act, 2010 (FCRA) and Companies Act, 2013.

The government brought in the latest amendment through the same route of Finance Bill even after receiving the Supreme Court notice on similar moves earlier and the case is still being heard.

There are at least 25 instances of the Congress and the BJP receiving funding from the ‘Indian’ subsidiaries of various foreign companies before 2010.  As the table below, compiled by ADR, shows, the parties have received funding in the range of Rs 5 lakh to Rs 5 crore from the Indian subsidiaries of Vedanta, Dow Chemicals and Switzerland-based Mundipharma over the course of six years from 2004 to 2010.

Company Amount (In Rupees) Year of Donation Political Party Parent Company
Hyatt Regency 5,00,000 FY 04-05 INC American Origin Company
Sterlite Industries Ltd 100,00,000 FY 04-05 INC Vedanta
Sesa Goa Ltd 5,00,000 FY 04-05 INC Vedanta
Sesa Goa Ltd 5,00,000 FY 04-05 INC Vedanta
Sesa Goa Ltd 2,00,000 FY 04-05 INC Vedanta
Adani Wilmer Ltd 2,50,000 FY 05-06 INC Adani Wilmar Limited is a 50:50 joint venture between the Adani Group and Wilmar International Limited
Sesa Goa Ltd 5,00,000 FY 05-06 INC Vedanta
Sesa Goa Ltd 5,00,000 FY 05-06 INC Vedanta
Sesa Goa Ltd 2,00,000 FY 06-07 INC Vedanta
Sesa Goa Ltd 15,00,000 FY 07-08 INC Vedanta
Adani Wilmer Ltd 5,000,000 FY 08-09 INC Adani – Wilmer JV
Solaries Holding Ltd 5,000,000 FY 09-10 INC Vedanta
Solaries Holding Ltd 5,000,000 FY 09-10 INC Vedanta
Sterlite Industries (India) Ltd. 50,000,000 FY 09-10 INC Vedanta
Sesa Goa Ltd 30,00,000 FY 09-10 INC Vedanta
Sesa Goa Ltd Sesa Ghor 5,00,000 FY 05-06 BJP Vedanta
Win Medicare (P) Ltd 25,00,000 FY 05-06 BJP Swiss origin company
Sesa Goa Ltd 2,00,000 FY 06-07 BJP Vedanta
Dow Chemical Int (P) Ltd 1,00,000 FY 06-07 BJP Union Carbide acquirer
Sesa Goa Ltd 15,00,000 FY 07-08 BJP Vedanta
Sesa Goa Ltd 12,50,000 FY 07-08 BJP Vedanta
Adani Wilmar Ltd 50,00,000 FY 08-09 BJP Vedanta
Vedanta The Madras Aluminum Ltd 30,000,000 FY 09-10 BJP Vedanta
Vedanta The Madras Aluminum Ltd 50,00,000 FY 09-10 BJP Vedanta
Sesa Goa Ltd 50,00,000 FY 09-10 BJP Vedanta
Win Medicare (P) Ltd 25,00,000 FY 09-10 BJP Swiss origin company
Sesa Goa Ltd 10,00,000 FY 09-10 BJP Vedanta

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Four militants killed as rival Naga groups clash in Manipur village

Four militants were killed in a gunfight between suspected rival Naga groups at Taodaijang village in Manipur’s Noney district on Wednesday.

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Manipur violence

At least four militants were killed in a gunfight between suspected rival Naga militant groups in Manipur’s Noney district on Wednesday, November 4.

The exchange of fire took place at Taodaijang village in the Khoupum area of the Naga-majority district. According to officials, the cadres involved were suspected to belong to rival Naga militant outfits, including the Zeliangrong United Front-Jenchui (ZUF-J) and the Zeliangrong United Front-Kamson (ZUF-K).

Initial reports indicated that the gunfight continued for several hours, leaving three cadres of ZUF-J and one cadre of ZUF-K dead.

The bodies of the deceased militants were subsequently recovered by local residents.

Residents appeal to armed groups to stop firing

Following the gunfight, local residents, including women, reached the spot in an attempt to prevent further violence between the rival groups.

They also used a public address system to appeal to the armed cadres to stop firing and prevent the situation from escalating further.

Further details about the circumstances surrounding the clash were awaited.

Manipur government reviews security situation

In a separate development, Manipur Chief Minister Yumnam Khemchand Singh directed senior security officials to identify active armed groups suspected of involvement in recent incidents of violence in the state.

The directive excluded groups engaged in peace talks with the state government.

The Chief Minister issued the instructions during a review meeting on the state’s law and order situation on Tuesday night.

He also asked security agencies, including the Army and central paramilitary forces, to submit a detailed report on the involvement of the suspected groups.

The Chief Minister said the state Cabinet could consider declaring such groups unlawful if their involvement in violence against innocent civilians was established.

He also emphasised that necessary action would be initiated against groups continuing to perpetrate violence against civilians.

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Agnipath scheme gets 2-year extension for Agniveers, tenure may rise to 6 years

The Centre has introduced a two-year extension for the remaining 75% of Agniveers under the Agnipath scheme, creating another opportunity for them to seek enrolment in the regular armed forces.

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The Centre has introduced a significant change to the Agnipath recruitment scheme, offering a two-year extension to Agniveers who were earlier expected to leave the armed forces after completing their initial four-year service.

Chief of Defence Staff (CDS) General NS Raja Subramani announced the decision on Wednesday following a Union Cabinet meeting. Under the revised arrangement, the 75% of Agniveers who were not initially selected for absorption into the regular armed forces will be offered an additional two-year engagement period.

The development creates another opportunity for these personnel to continue serving in the armed forces beyond their original four-year tenure.

What changes under the revised Agnipath scheme?

Under the original Agnipath framework, Agniveers were recruited for a four-year service period, including training. At the end of this tenure, up to 25% of each batch could be selected for permanent enrolment into the regular armed forces, while the remaining 75% were expected to return to civilian life.

The revised arrangement introduces an additional two-year engagement for the latter group. This means their potential service period could increase from four to six years.

The extension also creates another opportunity for Agniveers to seek enrolment into the regular armed forces after completing the additional two years.

What happens after the additional two years?

According to General NS Raja Subramani, Agniveers completing the extended engagement period and willing to continue serving will be considered for enrolment in the regular armed forces.

Their selection will be based on objective criteria.

This creates an additional pathway for those who are not absorbed into the regular forces after their initial four-year tenure. However, the revised arrangement does not mean that every Agniveer will automatically receive permanent enrolment.

Why has the decision been taken now?

The announcement comes as the first batch of Agniveers recruited under the scheme approaches the completion of its initial four-year service period.

The Agnipath scheme was introduced on June 14, 2022, to recruit personnel into the Indian Army, Navy and Air Force for a fixed four-year engagement.

General Raja Subramani said the scheme had been undergoing periodic reviews, with the performance of Agniveers being continuously evaluated. He also indicated that feedback on their performance had been very positive.

The latest Cabinet decision creates an additional route for retaining personnel beyond the initial engagement period.

What was the original Agnipath arrangement?

Under the original framework, the armed forces could retain up to 25% of Agniveers in the regular cadre after their four-year service period, subject to selection.

The remaining 75% were to complete their engagement and transition to civilian life.

With the latest revision, this group will receive an additional two-year engagement opportunity before being considered for enrolment into the regular armed forces under the prescribed selection criteria.

The change therefore modifies the earlier arrangement by providing an additional opportunity for Agniveers to continue their military careers.

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Hardeep Singh Puri set to win Rajya Sabha bypoll unopposed

Union Minister Hardeep Singh Puri is set to be elected unopposed to the Rajya Sabha from Madhya Pradesh after the returning officer rejected the nomination papers of two independent candidates.

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Hardeep Puri

Union Petroleum Minister Hardeep Singh Puri is set to enter the Rajya Sabha unopposed from Madhya Pradesh after the nomination papers of two independent candidates were rejected during scrutiny on Tuesday.

The two candidates whose nominations were rejected were Kante Sayanna and Rajkumar Lohani, the latter being backed by the Congress. Their rejection leaves Puri as the only candidate in the contest for the vacant Rajya Sabha seat.

According to an official, the result will be announced on November 5, which is also the last date for withdrawal of nominations.

The Returning Officer, Umesh Sharma, examined the nomination papers on the last day of scrutiny and rejected the two independent candidates’ applications.

Objections raised against Hardeep Puri’s nomination

The nomination papers submitted by Puri also faced objections from the two independent candidates and Congress leader Hemant Katare.

They questioned the validity and completeness of Puri’s affidavit filed in Form 26, raising concerns over whether the mandatory details had been properly furnished.

However, after examining the objections, Returning Officer Umesh Sharma concluded that Puri had not violated any requirements under the Representation of the People Act.

Sharma stated in his order that no defect had been found in Puri’s nomination papers that could justify their rejection.

Following the decision, Katare and Congress MLA Atif Aqeel announced that they would approach the court against the order.

Calling the decision an attack on Indian democracy, the Congress leaders said in a statement that Puri’s nomination should have been rejected despite what they described as significant errors.

Why the Madhya Pradesh Rajya Sabha seat fell vacant

The by-election was necessitated by the resignation of Union Minister L Murugan, which left a Rajya Sabha seat vacant in Madhya Pradesh.

With the nomination papers of both independent candidates rejected and Puri’s nomination cleared, the Union minister is set to be elected unopposed.

The final announcement is expected on November 5, the last day for withdrawal of nominations.

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