NEW
DELHI: Is it a case of the pot, namely, the Congress-led government,
calling the kettle, namely, Aam Aadmi Party, black? Or, is this about
Arvind Kejriwal being hoist by his own petard? Underlying the announcement of a probe into the alleged foreign
funding
of AAP is its innovative legal interpretation, which is sharply at
variance with that of the government and two leading parties,
Congress and BJP.
In a departure from a long-entrenched practice, AAP professes to be
transparent about the funding it has been receiving from abroad. It
claims to have disclosed all the details on its website in keeping with
its interpretation that the law permits donations from NRIs who are
Indian citizens. Accordingly, it has also published the Indian passport
numbers of all its donors from abroad. Though the law exempts political
parties from revealing sources of donations worth less than Rs 20,000,
AAP says that it has been disclosing even the donations that are below
the lower limit.
While the two related claims of transparency
by AAP will now be verified by the official inquiry, it is ironic that
mainstream parties which are notoriously opaque about their funding
sources are not being subjected to similar scrutiny. This is despite the
fact that their funding is admittedly on a much larger scale and the
recent report of the Association for Democratic Reforms (ADR) has shown
that about 75% of their funding comes from unknown sources.
According to the ADR analysis of
income tax returns and statements with the
Election Commission,
the total income of the six national parties from 2004-05 to 2011-12
was Rs 4,896 crores. Yet, for as much as Rs 3,675 crores, those parties
gave no details of their sources. Given their general proclivity to be
secretive about the sources and probably even the quantum of their
income, the question whether donations can be received from NRIs holding
Indian passports never arose in the case of parties like Congress and
BJP.
From the details that have been disclosed by Congress and
BJP, ADR filed a PIL earlier this year before the Delhi high court
alleging that the two parties had been violating the Foreign
Contribution Regulatory Act (FCRA) by receiving donations to the tune of
tens of crores from foreign companies through their Indian
subsidiaries. The one example cited in the PIL argued by AAP leader
Prashant Bhushan is of UK-registered
Vedanta Resources, in which Indian citizen
Anil Agarwal holds at least 50% of the paid-up capital. Vedanta made donations to Congress and
BJP through three of its Indian subsidiaries, Sterlite,
Sesa Goa and MALCO.
In August, the home ministry and two leading political parties filed
affidavits claiming that a political donation from the Indian subsidiary
of a foreign company was permissible if an Indian held a majority
shareholding in the foreign company. Making a similar interpretation of
Section 591 of the Companies Act, all the three affidavits claimed that a
donation by any foreign company through its Indian subsidiary would not
be regarded as a foreign contribution so long as an Indian held a
majority stake in the parent company.
ADR's rejoinder, however,
asserted that the purpose of Section 591 was merely to ensure that
Indian subsidiaries of a foreign company were accountable to Indian
authorities. It said that this clause in the Companies Act could by no
means be cited to circumvent the express prohibition on foreign
contribution to political parties in FCRA and the Representation of the
People Act. Little wonder that AAP is citing ADR's PIL to hit back at
the rest of the political class, in the wake of the probe into the
donations it had received from abroad.
----- ----- ----- ----- -----
http://timesofindia.indiatimes.com/assembly-elections-2013/delhi-assembly-elections/Probing-source-of-foreign-funding-to-AAP-Shinde/articleshow/25589607.cms