Supreme Court orders audit of 30 lakh NGOs

10 Jan, Delhi: The Supreme Court of India on Tuesday directed the Centre to audit nearly 30 lakh NGOs which received public funds but consistently failed to explain how they spent the money.

A Bench led by Chief Justice of India J.S. Khehar and Justices N.V. Ramana and D.Y. Chandrachud ordered that any NGO found to have cooked its books or indulged in misappropriation should be subject to immediate criminal prosecution. Besides, the government should initiate civil recovery proceedings against such rogue organisations.

Public funds granted by governments to the tune of thousands of crores are spent on NGOs and voluntary organisations annually, the CBI submitted that only about three lakh of about 32 lakh NGOs file their balance sheets with the government.

Pulling up the Union government for failing to put in place a regulatory mechanism to keep a watch on the financial activities of NGOs and voluntary organisations, the apex court ordered that by next hearing, the government should have framed guidelines for their accreditation, the manner in which these organisations should maintain their accounts and the procedure for recovery in case they fail to submit their balance sheets.

“This is your [government] money and you have no record of how they [NGOs] use it?” Chief Justice Khehar asked the government.

 The Supreme Court directed to file a compliance report by March 31, 2017.