From UPSC perspective, the following things are important :
Prelims level : RTI Act
Mains level : Prevention of money laundering through NGOs
- Non-governmental organisations (NGOs) “substantially” financed by the government fall within the ambit of the Right to Information Act, the Supreme Court held in a judgment.
About the judgment
- NGOs which receive considerable finances from the government or are essentially dependent on the government fall under the category of “public authority” defined in Section 2(h) of the RTI Act of 2005.
- This means that they have to disclose vital information, ranging from finances to hierarchy to decisions to functioning, to citizens who apply under RTI.
- An NGO, the court said, may also include societies which are neither owned or controlled by the government, but if they are significantly funded by the government, directly or indirectly, they come under the RTI Act.
Why such move?
- RTI Act was enacted with the purpose of bringing transparency in public dealings and probity in public life.
- If NGOs or other bodies get substantial finance from the government we find no reason why any citizen cannot ask for information.
- With the judgment citizens can find out whether his/her money which has been given to an NGO is being used for the requisite purpose.
‘Substantial’ means how much?
- The court defined “substantial” as a “large portion.”
- It does not necessarily have to mean a major portion or more than 50%.
- No hard and fast rule can be laid down in this regard. Substantial financing can be both direct or indirect.
- If government gives land in a city free of cost or on heavy discount to hospitals, educational institutions or any such body, this in itself could also be substantial financing, the judgment explained.