Tuesday, 18 April 2017

Proposed Amendment under MPTA 1950

“Maharashtra government may monitor income of all charitable trusts”

Charitable organisations in Maharashtra State woke up to read a rather disturbing newsreport on page four in today’s (18th April 2017) Hindustan Times.

The report can also be read online at: http://m.hindustantimes.com/mumbai-news/maharashtra-govt-may-monitor-income-of-all-charitable-trusts/story-uLFIRmCHnDz3iYpqtoXWqJ.html

The report is titled: “Maharashtra government may monitor income of all charitable trusts”.

Hardly have charitable organisations recovered from the still potential threat of disclosure of personal assets under the Lokpal Act, when the Maharashtra State Government now appears to have decided to (according to the report) “monitor the income of charitable trusts irrespective of the sector they are working in”. Reportedly, the BJP-led government plans to make it mandatory for charitable trusts to inform the charity commissioner’s office before accepting any money. How ridiculous is that?

Allegedly, the state wants to amend the Maharashtra Public Trusts Act (MPTA) 1950 and the proposal for this is awaiting the state cabinet’s approval. According to the proposal, all types of charitable trusts will have to inform the deputy or assistant charity commissioner before accepting any monetary contribution.
The amendment, we are told, will allow the state to monitor the income of all charitable trusts and ensure the donated amount is spent for the specified cause only. Our response would be, isn’t that anyway being done? Charitable trusts in Maharashtra State not only file their audited statements of account (including Income & Expenditure Statements in the prescribed format) but also file budgets with the Charity Commissioner every year.
A senior state official is reported to have said: “This (amendment) will also stop misuse of the money and curb corruption in this sector”.  A classic case of the proverbial pot calling the kettle black! Reams could be written about misuse of state funds and corruption which is rampant across state departments, particularly the department that regulates charitable trusts in Maharashtra.
The report adds: “It also proposes punishment for offenders. The guilty will have to face imprisonment of up to three years and fines of up to one-and-a-half times the contribution taken from a donor or donors, said a source.”
Supposedly, the state’s move comes after the Centre decided to change Rule of Foreign Contribution (FCRA) allowing the Union home ministry to monitor usage of funds that NGOs receive and the central government making it mandatory for NGOs to maintain their contributory accounts in banks that offer core banking.
In our opinion if what is reported is true, it’s absolutely ridiculous! The State may "Regulate" charities. However, any endevour to "Control" (as reported) would be unconstitutional and can and should be challenged.

We will try to obtain copy of the proposed amendments which are before the Cabinet. In the meantime awareness and public opinion should be mobilized just the way we did when the sword of the Lokpal Act loomed over our heads!

Noshir H. Dadrawala

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