New Delhi: The Ministry of Home Affairs (MHA) has cancelled the FCRA license of an NGO with ties to Ladakh-based climate activist Sonam Wangchuk with immediate effect, citing alleged violations, including receipt of funds from a Swedish platform to conduct a study on the “sovereignty of the nation”. These funds, to the tune of Rs 4.93 lakh, were received from the institutional donor Future Earth, for creating awareness on youth migration, food security and sovereignty.
The foreigners division of the ministry said in its order Thursday that receiving funds for this purpose amounted to a violation of provisions of the Foreign Contribution (Regulation) Act, 2010.
It also flagged what it said was divergence between details submitted by the NGO in its annual reports, and its response to a show cause notice issued on 10 September.
Among the transactions in question is one where Wangchuk deposited Rs 3.5 lakh into the FCRA account of the NGO, Students’ Educational and Cultural Movement of Ladakh (SECMOL), during the financial year 2021-22.
The Foreign Contribution (Regulation) Act governs the inflow of funds from foreign sources into NGOs based in India. Under its provisions, each NGO is issued a licence for five years, which can be extended or cancelled based on MHA’s assessment of the use of such funds.
Cancellation of the FCRA licence issued to SECMOL, the NGO of which Wangchuk is founding-director, comes a day after the MHA accused him of ‘inciting’ the mob that went on a violent “rampage” in Leh, attacking government buildings and setting the local BJP office ablaze. At least four people were killed and more than 50 injured when the ‘police opened fire in self defence’. Wangchuk, who had been sitting on a hunger strike in Leh since 10 September to demand statehood and Sixth Schedule for Ladakh, had later in the day attributed the violence to “pent-up anger over the last five-six years”.
On Thursday, MHA’s foreigners division said it served SECMOL a show cause notice on 10 September seeking an explanation as to why its FCRA licence should not be cancelled. The NGO responded on 19 September, but its response was unsatisfactory, the MHA said.
In its response, the NGO submitted that there was a cash deposit of Rs 3.35 lakh made out of the sale of an old bus procured in 2015, and to comply with FCRA rules, proceeds from the sale of any assets bought using FCRA funds must be deposited in the FCRA bank account. The MHA said there was no credit of such an amount in the FCRA bank account.
Instead, there was an entry corresponding to receipt of donation of the same amount from Wangchuk in the annual statement, raising suspicion that the money was received in cash in violation of FCRA provisions, the ministry said. Referring to the development as a “sad story” and a “punishment”, Wangchuk told ThePrint that the Rs 3.5 lakh in his name in the FCRA account was because of an understanding between the management of the non-profit and himself over the exchange of an old bus with the new one gifted by him.
“I gifted them a new bus, and there was an understanding that the amount earned from the sale of the old bus would be given back to me. Since the old bus was purchased from FCRA funds, it was deposited into the account, but with an entry indicating that it was a loan from me, which was supposed to be paid to me.
“However, I ended up relinquishing that amount too. So, I gifted the new bus and also left the money made from the sale of the old bus with the non-profit for their benefit, and I am being punished for that. Had I taken back the money, this outstanding issue may well have been resolved. This is a sad story and a punishment,” he told ThePrint over the phone.
However, the MHA said it found that there was a difference in the entry made by the NGO in its annual financial statement, which claimed the funds deposited by Wangchuk to be foreign funds, and SECMOL’s response to the show cause notice in which it said that the funds came from sale of the decade-old bus bought using FCRA funds.
Additionally, the ministry has also flagged three deposits of Rs 18,200 each as local funds during FY 2021-22 which it said were in violation of FCRA rules. The NGO argued that these deposits were made by volunteers towards their food and accommodation, and they were mistakenly transferred into the FCRA account instead of other operational bank accounts.
The ministry also flagged the NGO returning funds amounting to Rs 19,600 to one of its donors, Megha Sanghavi from the Indian Institute of Management, in FY 2021-22, which it said was in violation of FCRA rules.
Among other alleged violations, the MHA documented in the order that the NGO received Rs 79,200 in foreign funding during FY 2020-21, but this amount was not deposited into the FCRA account. It was suspected to have been deposited into a local bank account, in violation of FCRA provisions, the MHA said. The NGO responded by saying that an equal amount was directly deducted from the salaries of staff and stipends to fellows.
“And WHEREAS, in view of violations as enumerated above u/s 8(1)(a), 4718 19 and conditions of registration under section 12(4)()Qof the Act, the FCRA registration certificate of the association is liable to be cancelled in exercise of power u/s 14 of the Act. 5 4,” the MHA said in its order.
Adding, “NOW THEREFORE, considering the facts and position narrated in preceding paras, the Competent Authority, hereby, in exercise of the powers conferred under section 14(1) of the Act, cancels with immediate effect the FCRA Certificate of Registration No. 152710012R granted to the association ‘Students Educational and Cultural Movement of Ladakh’.”
(Edited by Amrtansh Arora)
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