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Foreign funding of political parties after 1976 exempted from scrutiny

Our Bureau New Delhi | Updated on March 15, 2018 Published on March 15, 2018

Protests are rising against the “smuggling in” of a controversial amendment to the Foreign Contribution Regulation Act (FCRA) that exempts political parties from scrutiny of foreign funding, with retrospective effect.

The Finance Bill was passed in the Lok Sabha without debate earlier this week, a move that Revolutionary Socialist Party MP NK Premchandran alleged “hid” amendments to 25 other laws. “For example, the FCRA was passed in 2010 but the Centre has amended it with retrospective effect so that the Act will now be applicable from much before the original FCRA came into existence,” said Premchandran.

Premchandran is referring to entry number 217 in Part XIX of the amendments in the 2018 finance Bill (Amendment to the Finance Act, 2016), which reads : “In the Finance Act, 2016, in section 236, in the opening paragraph, for the words, figures and letters ‘the 26thSeptember, 2010, the words, figures and letters ‘the 5th August, 1976’ shall be substituted,” said the amendment. The FCRA was passed in 1976. It was later repealed and replaced with the FCRA, 2010.

Prior to the latest change, foreign funds received by a political party before September 26, 2010, when the FCRA was enacted, were open to scrutiny. With the latest amendment, the Government has, in effect, ensured that funds received by political parties since 1976 cannot be scrutinised.

No scrutiny

The Representation of People’s Act, which lays down the rules for elections, bars political parties from accepting foreign funds. But the 2016 amendments in the FCRA made it easier for parties to accept foreign funds. The 2018 amendment completely does away with the scope for scrutiny of a political party’s funding for the last 42 years.

The Delhi High Court had in 2014 indicted the two national parties, the Congress and the BJP, for receiving foreign funds in violation of the provisions of the FCRA.

A division bench comprising Justice Nandrajog and Justice Jayant Nath had asked the Government and the Election Commission to act against the two political parties for accepting foreign funds from Vedanta subsidiaries. The verdict came on a PIL filed by the Association for Democratic Reforms and argued by lawyer and political activist Prashant Bhushan.

Reacting to the amendment, Bhushan said on twitter: “Finance Bill contained many smuggled changes... .”

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Published on March 15, 2018
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