The Supreme Court has directed the government to audit nearly 30 lakh non-governmental organisations (NGOs) which received public funds but consistently failed to explain how they spent the money. A bench led by J S Khehar regretted that there was no regulatory mechanism to make NGOs answerable on utilising funds while the government pumped in public money.
A bench led by Chief Justice of India J S Khehar regretted that there was no regulatory mechanism to make NGOs answerable on utilising funds while the government pumped in public money.It said that mere blacklisting the NGOs would not suffice but there was a need to include criminal action for misappropriation and swindling of funds disbursed to NGOs for certain purposes.
Additional Solicitor General Tushar Mehta agreed with the bench that a new regime should be put in place to regulate NGOs and sought some time to revert. The court, however, pointed out that provisions of CAG auditing and scrutiny under the General Financial Rule, 2005 were already operating in this area. And that the competent authority will now have to come out with guidelines and rules for a regulatory mechanism by March-end.
The bench noted that such action must be taken by the Centre and the Council for Advancement of People’s Action and Rural Technology (CAPART), a wing under the Ministry of Rural Development which has been instrumental in granting the fund