CAG fears laundering of black money worth Rs 15k cr through foreign donations

The ministry of home affairs (MHA) sources said during the financial year 2009-10 alone, several NGOs and Trusts received FCs worth Rs 10,338 crore. However, the CBDT has not issued any guidelines or circulars to monitor receipt of FCs and their utilisation. Even during 2008-2009, nearly Rs 600 crores of FCs was received by several oragnisations for ‘social cause’ but it also went unaccounted for in the absence of any CBDT guidelines. Many economists feels it might be possible that a hefty amount of black money was laundered during this period using the loophole in the system.

Concerned over the ‘fact and figures’, the Comptroller and Auditor General of India (CAG) too conveyed the matter to the concerned ministries and advised them to take some initiatives to find out the purpose of the money received by the NGOs and Trusts and its utilisation during 2008-2010. It’s a general practise for the ministry of finance and the ministry of home affairs (MHA) to monitor foreign funds, prepare a detailed record from where the fund was received and who received them and for what purpose was the fund donated.

During the financial year 2009-10, nearly 21,508 organisations and trusts received FCs amounting to Rs 10,338 and nearly Rs 600 crore was received in 2008-2009 by 9,750 social welfare groups. During this period, in Gujarat alone, nearly 73 Trusts received FCs amounting to Rs 272.35 crore, which was left unscrutinised by the Income Tax Department.

‘The concerned department has not ascertained whether the voluntary donations were received with any specific direction or whether they formed part of a corpus fund and the same has been utilised for the purpose for which they was received and not used for any other activities which are against national interest,’ a MHA source said. He also said: ‘During this period the Income Tax Department did not prescribe any column in the ITR form (ITR-7) for FCs to enable officers to make proper assessment.’