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The Fund Fracas

A public interest litigation filed in the Delhi High Court has brought into focus the status of the Fund and whether it should be made accountable to public scrutiny. The centre’s legal stand leaves many questions unanswered.

By Dr Swati Jindal Garg

Does the PM CARES Fund, its financial status and disbursement amount to a State secret? In response to a PIL, the centre has informed the Delhi High Court that the Prime Minister’s Citizen Assistance and Relief in Emergency Situations (PM CARES) Fund is set up as a public charitable trust and is not created under the Constitution or any law made by the Parliament or the State. The response was in respect to a plea seeking to declare the fund a “State” under Article 12 of the Constitution to ensure transparency in its functioning. The PM CARES Fund was established in March 2020 as a “dedicated national fund” to deal with “any kind of emergency or distress situation” in the aftermath of the corona-virus pandemic.

The matter was heard by a division bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad. Senior advocate Shyam Divan, who was appearing for the PIL litigant, pleaded: “When you have high constitutional authorities setting up the trust which has ex-officio members, it is nothing but an element or aspect of State. Merely by declaring it is not ‘State’ would not exclude or exempt you from the constitutional fetters. If you are not (state) then you can’t have government symbols or a government website so that the public thinks that you are ‘State’. There are scores of constitutional functionaries…you are allowed a large amount of flexibility, but there are constitutional fetters. If you are not [State] then you can’t have government symbols or a government website so that the public thinks that you are ‘State’. Either you are ‘State’ or you are not.” 

Divan stressed the fact that representations have been made to the general public by high public and constitutional functionaries asking for contribution to PM CARES and that has given the impression to the public that the fund is a State-managed fund and hence can be held accountable to it. Diwan also contended that the PM Cares Fund has from the very beginning operated with the domain name of the Government of India and has the photograph of the prime minister as well as the Ashoka Pillar.

It was also held by the petitioner that time and again, government functionaries have been making public announcements which have led the public to firmly believe that the said fund is a State owned/ managed fund and hence most have made contributions under that misrepresentation. The petition said that as a result of presenting the Fund in such a manner, it received huge donations. The PM CARES Fund website showed that Rs 3,076.62 crore was collected merely within four days of its creation, the plea noted.

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Clarifying that their intention behind the filing of the PIL was only to ensure that the trust is not misused, Diwan also elaborated that their contention is definitely not that the trust is in any way mala fide. He argued that his only objection to the said trust and its representation was that the Fund cannot be contracted out of the Constitution merely by introducing a “self-declaration” stating that it is not a State.

The centre, on the other hand, stated in its affidavit that the trust is “neither intended to be nor in fact owned or controlled” by any government or any instrumentality of the government and the composition of the board of trustees consisting of holders of public office is merely for administrative convenience. “There is no control of either the Central Government or any State Government/s, either direct or indirect, in functioning of the Trust in any manner whatsoever,” the centre said.

The centre also clarified that the trust is not a public authority under RTI and it accepts voluntary donations by individuals and institutions and any contributions flowing out of budgetary sources of government are not accepted. “The PM CARES accepts only voluntary donations by individuals and institutions. Contributions flowing out of budgetary sources of government or from the balance sheets of the public sector undertakings are not accepted. Conditional contributions, where the donor specifically mentions that the amount is meant for a particular purpose, are not accepted in the Fund,” it said, adding, “the composition of the board of trustees consisting of holders of public office ex-officio is merely for administrative convenience and for smooth succession to the trusteeship, and is not intended to be controlled by the government in any manner.”

The affidavit also stated that since it is not constituted under law or the Constitution, the PM CARES does not constitute a public authority under the provisions of the RTI Act. “That the cause for which PM CARES Fund/Trust was created and exists is purely charitable and neither the funds of this trust are used for any government projects nor is this trust governed by any of the government policies. So, the PM CARES cannot be labelled as a public authority,” the affidavit said.

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The opposing argument is that accountability breeds responsibility. Where there is no accountability, there will also be no responsibility. By shielding it from the purview of the RTI Act only adds to the lack of transparency and accountability. The centre argued that the funds of the trust do not have a government character and hence no guidelines can be laid down for disbursement of the amount from the funds of PM CARES. It also said that the national emblem and domain name “gov.in” are being used for the Prime Minister’s National Relief Fund and is also being used for PM CARES Fund.

If viewed in the light of what the apex court held in its 2020 judgment, wherein the court held that “mere fact that administration of PM CARES is vested in trustees will not itself take away the public character of the trust”, can it not be inferred that the PM Cares Fund should also be open to the RTI Act and hence made to show how it utilises the funds that have been credited to it by the public?

Irrespective of the fact that the centre has time and again said that the trust functions on the principles of transparency and public good in the larger public interest like any other charitable trust and, therefore, cannot have any objection in uploading all its resolutions on its website to ensure transparency, the fact that the transparency is still not visible cannot be ignored. Taking benefit of one law or the other, total transparency has been avoided on many grounds, including the one that says irrespective of whether the trust is a “State” or other authority within the meaning of Article 12 of the Constitution and or whether it is a “public authority” under the RTI Act, “it is not permissible to disclose third party information”!

While the affidavit filed by the centre under discussion has been filed in a petition seeking a direction to declare the PM CARES Fund a “State” under the Constitution to ensure transparency in its functioning, the same petitioner, Samyak Gangwal, has also filed another petition to declare PM CARES as a “public authority” under the RTI Act, which is being heard together with this plea.

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It is quite clear that “intentions do not insulate us from the consequences of our actions.” No matter what the intentions of the centre are or might have been, the fact that the public needs some answers cannot be hidden or procrastinated any longer. Through the various pleadings that have been put on behalf of the centre before the Delhi High Court, it has tried to clarify its stance by saying: “The benefit of the objects of the Trust have been made available to the general public irrespective of caste, creed, sex, region, language and religion. Moreover, Trust Deed of the PM CARES Fund along with grants sanctioned from the fund are available in public domain on the website pmcares.gov.in. Audit reports of the PM CARES Fund are already available on the website.” Yet, the fact remains that these reports are not sufficient and we still have a long way to go before the trust can be freed from all questionability. 

—The author is an Advocate-on-Record practising in the Supreme Court, Delhi High Court and all district courts and tribunals in Delhi

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