INDIAN SOCIAL ACTION FORUM (INSAF) versus UNION OF INDIA

[2020] 4 S.C.R. 903

INDIAN SOCIAL ACTION FORUM (INSAF)

UNION OF INDIA

(Civil Appeal No. 1510 of 2020)

MARCH 06, 2020

[L. NAGESWARA RAO AND DEEPAK GUPTA, JJ.]

Foreign Contribution (Regulation) Act, 2010: Purpose ofenactment – Held: It is made to consolidate the law to regulate theacceptance and utilisation of foreign contribution or foreignhospitality by certain individuals or associations or companies andto prohibit acceptance and utilisation of foreign contribution orforeign hospitality for any activities detrimental to the nationalinterest and for matters connected therewith or incidental thereto.

Foreign Contribution (Regulation) Act, 2010: ss.5(1) and5(4) – Constitutional validity of – The power conferred by the Acton the Central Government to declare an organisation to be anorganisation of political nature u/s.5(1) of the Act was challengedby the Appellant on the ground that no guidelines are providedfor the exercise of such power – s.5(4) of the Act was assailed onthe ground that the authority to which representation made bythe aggrieved party is to be forwarded, has not been specified –Held: s.5(1) does not suffer from the vice of vagueness invitingthe wrath of Art. 14 – s.5(4) cannot be declared as unconstitutionalonly on the ground that the authority to whom representationshould be made is not specified – Constitution of India – Arts.14,19(1)(a), 19(1)(c) and 21.

Foreign Contribution (Regulation) Rules, 2011: rr.3(i), 3(v)and 3(vi) – Constitutional validity of – According to the Appellant,the guidelines provided in r.3 of the Rules are impermissibly wide,giving arbitrary discretion to the authorities which would result inabuse of the power – It was alleged in the Writ Petition that theRules suffer from unreasonableness and arbitrariness – Appellantprayed for declaring rr.3(i), 3(v) and 3(vi) as violative of thefundamental rights enshrined in Arts.14, 19(1)(a), 19(1)(c) and 21of the Constitution – Held: According to r.3(i), an organisationhaving avowed political objectives in its memorandum of

DEF

Aassociation or bye laws is an organisation of political nature –As the intention of the legislature is to prohibit foreign funds inactive politics, an Association with avowed political objectives (i.e.to play role in active politics or party politics) cannot bepermitted access to foreign funds – There is no ambiguity in theprovision and hence, cannot be termed as vague – r.3 (i) is notBultra vires the Act – r.3 (v) deals with organisations of farmers,workers, students etc. which are not directly aligned to any politicalparty but objectives of which include steps towards advancementof ‘political interests’ of such groups – Prohibition from receivingforeign aid, either directly or indirectly, by those who are involvedCin active politics is to ensure that the values of sovereigndemocratic republic are protected – On the other hand, such ofthose voluntary organisations which have absolutely no connectionwith either party politics or active politics cannot be denied accessto foreign contributions – Therefore, such of those organisationswhich are working for the social and economic welfare of theDsociety cannot be brought within the purview of the Act or theRules by enlarging the scope of the term ‘political interests’ – Theexpression ‘political interests’ in r.3 (v) has to be construed to bein connection with active politics or party politics – Anyorganisation which habitually engages itself in or employs commonEmethods of political action like ‘bandh’ or ‘hartal’, ‘rasta roko’,‘rail roko’ or ‘jail bharo’ in support of public causes can also bedeclared as an organisation of political nature, according to theguideline prescribed in r.3 (vi) – Support to public causes byresorting to legitimate means of dissent like bandh, hartal etc.cannot deprive an organisation of its legitimate right of receivingFforeign contribution – It is clear from the provision itself thatbandh, hartal, rasta roko etc., are treated as common methods ofpolitical action – Any organisation which supports the cause of agroup of citizens agitating for their rights without political goalor objective cannot be penalized by being declared as anGorganisation of political nature – To save this provision frombeing declared as unconstitutional, it is held that it is only thoseorganisations which have connection with active politics or takepart in party politics, that are covered by r.3 (vi).

Interpretation of Statutes: Two interpretations – Held: In caseHof ambiguity in the language used in the provision of statute,

the Courts can take aid from the historical background, theParliamentary debates and the aims and objects of the Act –Foreign Contribution (Regulation) Rules, 2011.

Disposing of the appeal, the Court

HELD: 1. The Foreign Contribution (Regulation) Act, 1976was enacted to regulate the acceptance and utilization of foreigncontribution or foreign hospitality by certain persons orassociations with view to ensure that parliamentaryinstitutions, political associations, academic and other voluntaryorganisations as well as other individuals working in importantareas of national life may function in manner consistent withthe values of sovereign democratic republic and the mattersconnected therewith and incidental thereto. In view of severaldeficiencies in the 1976 Act, fresh law in the shape of theForeign Contribution (Regulation) Act, 2010 was made byrepealing the 1976 Act. The long title of the 2010 Act indicatesthat it is made to consolidate the law to regulate the acceptanceand utilisation of foreign contribution or foreign hospitality bycertain individuals or associations or companies and to prohibitacceptance and utilisation of foreign contribution or foreignhospitality for any activities detrimental to the national interestand for matters connected therewith or incidental thereto. [Paras5-7] [912-G; 913-A-D-G; 914-A]

Association for Democratic Reforms v. Union of India(2014) 209 DLT 609 – referred to.

2. Section 5 of 2010 Act stipulates that the CentralGovernment shall specify an organisation as an organisation ofa political nature not being political party as referred to inSection 3 (1)(f) having regard to the activities of the organisationor the ideology propagated by the organisation or associationof the organisation with the activities of any political party. It isfurther provided in Section 5(1) that the Central Governmentmay by Rules frame guidelines specifying the ground(s) on whichan organisation shall be specified as an organisation of politicalnature. Section 48(2)(d) empowers the Central Government toframe guidelines, specifying the ground(s) on which anorganisation may be specified as an organisation of politicalnature under Section 5(1). In exercise of power conferred under

ASection 48, the Central Government framed the ForeignContribution (Regulation) Rules, 2011. [Paras 8, 9] [914-F-H;915-A]

3. plain reading of Section 3 of the Act shows that foreigncontributions should not be accepted by candidate in anBelection or by political party or office bearer thereof andmember of any legislature apart from Judges and Governmentservants and those belonging to the press, print and electronicmedia. Section 3(1)(f) of the Act provides that an organisationof political nature is also barred from receiving foreigncontributions. Such an organisation of political nature may beCspecified under Section 5(1) by the Central Government.[Para 10] [915-G-H]

4. Section 5 of the 1976 Act provided that any organisationof political nature not being political party shall not acceptany foreign contribution except with the prior permission of theDCentral Government. However, according to the 2010 Act, anorganisation of political nature, as specified, is barred fromaccepting foreign contributions. The procedure to notify anorganisation of political nature is prescribed under Section 5of the 2010 Act. Before declaring an organisation to be anEorganisation of political nature not being political party, theCentral Government shall take into account the activities of theorganisation or the ideology propagated by the organisation orthe programme of the organisation or the association ofthe organisation with the activities of any political party. Section5(1) does not suffer from the vice of vagueness inviting the wrathFof Article 14. Section 5(4) cannot be declared as unconstitutionalonly on the ground that the authority to whom representationshould be made is not specified. No serious attempt has beenmade by the Appellant-organisation to assail Section 5 (4) of theAct. [Paras 11-13] [916-A-C-H; 917-A]G

5. The Appellant-organisation is not entitled to invokeArticle 19. No member of the Appellant-organisation is arrayedas party. Article 19 guarantees certain rights to ‘all citizens’.The Appellant, being an organisation, cannot be citizen for thepurpose of Article 19 of the Constitution. In the absence of anyHmember of the association as petitioner in the Writ Petition,

the Appellant-organisation cannot enforce the rights guaranteedunder Article 19 of the Constitution. [Para 15] [917-E-F]

State Trading Corporation of India Ltd. v. TheCommercial Tax Officer, Visakhapatnam [1964] 4 SCR99 ; Bennett Coleman & Co. v. Union of India (1972)2 SCC 788 : [1973] 2 SCR 757 ; Tata Engineeringand Locomotive Ltd. v. State of Uttar Pradesh (2011)3 SCC 193 : [2011] 3 SCR 134 – relied on.

6. It is settled principle of interpretation that theprovisions of the statute have to be interpreted to give the wordsa plain and natural meaning. But, if there is scope for twointerpretations, the Courts have preferred purposiveconstruction, which is now the predominant doctrine ofinterpretation. In case of ambiguity in the language used in theprovision of statute, the Courts can take aid from the historicalbackground, the Parliamentary debates, the aims and objects ofthe Act including the long title, and the endeavour of the Courtshould be to interpret the provisions of statute to promote thepurpose of the Act. [Para 17] [918-E-F]

K. A. Abbas v. Union of India (1970) 2 SCC 780:

[1971] 2 SCR 446 ; Chiranjit Lal Chowduri v. Unionof India [1950] SCR 869 ; Union of India v.Elphinstone Spinning and Weaving Co. Ltd. (2001) 4SCC 139 : [2001] 1 SCR 221 – relied on.

7. The object sought to be achieved by the Act is to ensurethat Parliamentary institutions, political associations andacademic and other voluntary organisations as well as individualsworking in the important areas of national life should functionin manner consistent with the values of sovereign democraticrepublic without being influenced by foreign contributions orforeign hospitality. The long title of the Act makes it clear thatthe regulation of acceptance and utilisation of foreigncontribution is for the purpose of protecting national interest.Candidates for election and political parties or office bearers ofpolitical parties are barred from accepting any foreigncontribution. The legislative intent is also to prohibitorganisations of political nature from receiving foreign

Acontributions. It is clear that preventing foreign contribution intothe political arena is the object sought to be achieved by theAct. Prevention of foreign contributions routed throughvoluntary organisations which are not connected to party politicsis the reason behind introduction of Section 3(1)(f) and SectionB5 of the Act. The Central Government is required to take intoaccount the activities, ideology or the programme of theorganisation including the association of the organisation withactivities of any political party before declaring an organisationas an organisation of political nature not being political party.

Guidelines that are prescribed by the Rules indicate that onlyCthose organisations which are actively involved in politics orassociated with political parties can be declared as organisationsof political nature. According to Rule 3(I), an organisationhaving avowed political objectives in its memorandum ofassociation or bye laws is an organisation of political nature.DAs the intention of the legislature is to prohibit foreign funds inactive politics, an Association with avowed political objectives(i.e. to play role in active politics or party politics) cannot bepermitted access to foreign funds. There is no ambiguity in theprovision and hence, cannot be termed as vague. Therefore,there is no substance in the contention of the Appellant that RuleE3(i) is ultra vires the Act. [Para 18] [918-G; 919-A-F]8. Rule 3(v) deals with organisations of farmers, workers,students etc. which are not directly aligned to any political partybut objectives of which include steps towards advancement of‘political interests’ of such groups. The submission made onFbehalf of the Appellant is that such organisations agitating fortheir legitimate claims cannot be prevented access to foreignfunds by resorting to the vague term ‘political interests’. It iscorrect to state that the words ‘political interests’ are vague andare susceptible to misuse. However, possible abuse of power isGnot ground to declare provision unconstitutional. [Para 19][919-G-H; 920-A]

9. Where the provisions of statute are vague andambiguous and it is possible to gather the intention of thelegislature from the object of the statute, the context in whichHthe provisions occur and purpose for which it is made, the

doctrine of “reading down” can be applied. To save Rule 3(v)from being declared as unconstitutional, the Court can applythe doctrine of “reading down”. balance has to be drawnbetween the object that is sought to be achieved by thelegislation and the rights of the voluntary organisations to haveaccess to foreign funds. The purpose for which the statuteprevents organisations of political nature from receivingforeign funds is to ensure that the administration is notinfluenced by foreign funds. Prohibition from receiving foreignaid, either directly or indirectly, by those who are involved inactive politics is to ensure that the values of sovereigndemocratic republic are protected. On the other hand, such ofthose voluntary organisations which have absolutely noconnection with either party politics or active politics cannot bedenied access to foreign contributions. Therefore, such of thoseorganisations which are working for the social and economicwelfare of the society cannot be brought within the purview ofthe Act or the Rules by enlarging the scope of the term ‘politicalinterests’. The expression ‘political interests’ in Rule 3(v) hasto be construed to be in connection with active politics or partypolitics. [Paras 20, 21] [920-A-E]

10. Any organisation which habitually engages itself in oremploys common methods of political action like ‘bandh’ or‘hartal’, ‘rasta roko’, ‘rail roko’ or ‘jail bharo’ in support of publiccauses can also be declared as an organisation of political nature,according to the guideline prescribed in Rule 3(vi). Support topublic causes by resorting to legitimate means of dissent likebandh, hartal etc. cannot deprive an organisation of its legitimateright of receiving foreign contribution. It is clear from theprovision itself that bandh, hartal, rasta roko etc., are treatedas common methods of political action. Any organisation whichsupports the cause of group of citizens agitating for their rightswithout political goal or objective cannot be penalized by beingdeclared as an organisation of political nature. To save thisprovision from being declared as unconstitutional, it is held thatit is only those organisations which have connection with activepolitics or take part in party politics, that are covered by Rule3(vi). [Para 22] [920-F-G; 921-A]

CCIVIL APPELLATE JURISDICTION : Civil Appeal No. 1510of 2020From the Judgment and Order dated 16.09.2011 of the HighCourt of New Delhi in Writ Petition (Civil) No. 5793 of 2011.

Sanjay Parikh, Sr. Adv., Abhimanue Shrestha, Kabir Dixit,DMs. Sanjana Srikumar, Advs. for the Appellant.

Tushar Mehta, SG, K.M. Natraj, ASG, Sharath N. Nambiar,Ms. Indira Bhakur, Vinayak Sharma, Ms. Priyanka Bhat, Vatsal Joshi,Shrekanthji, Ms. Shraddha Deshmukh, Ankur Talwar, DevashishBharukha, Kanu Agrawal, Rahul Jajoo, Advs. for the Respondent.

EThe Judgment of the Court was delivered by

L. NAGESWARA RAO, J.

1. The Appellant filed Writ Petition in the High Court of Delhifor declaration that Sections 5 (1) and 5 (4) of the Foreign Contribution(Regulation) Act, 2010 (hereinafter referred to as ‘the Act’) and RulesF3 (i), 3 (v) and 3 (vi) of the Foreign Contribution (Regulation) Rules,2011 (hereinafter referred to as ‘the Rules’), are violative of Articles14, 19 (1) (a), 19 (1) (c) and 21 of the Constitution of India. The HighCourt dismissed the Writ Petition, aggrieved by which this appeal hasbeen filed. The Appellant is registered society involved in resistingGglobalization, combating communalism and defending democracy. In theWrit Petition filed before the High Court, the Appellant-organisationstated that it firmly believes in secular and peaceful social order andopposes communalism and the targeted attacks on the lives and rightsof people including religious minorities. Several activities of theAppellant-organisation in the interest of the society have been referredHto in the Writ Petition. The power conferred by the Act on the Central

Government to declare an organisation to be an organisation of politicalnature under Section 5 (1) of the Act was challenged by the Appellanton the ground that no guidelines are provided for the exercise of suchpower. Section 5 (4) of the Act was assailed on the ground that theauthority to which representation made by the aggrieved party is tobe forwarded, has not been specified. According to the Appellant, theguidelines provided in Rule 3 of the Rules are impermissibly wide, givingarbitrary discretion to the authorities which would result in abuse ofthe power. It was alleged in the Writ Petition that the Rules suffer fromunreasonableness and arbitrariness. Hence, the Appellant prayed fordeclaring Rules 3(i), 3(v) and 3(vi) as violative of the fundamental rightsenshrined in Articles 14, 19(1)(a), 19(1)(c) and 21 of the Constitution.

2. After considering the relevant provisions of the Act and thesubmissions made on behalf of the Appellant, the High Court of Delhidismissed the Writ Petition as being bereft of merit.

3. Mr. Sanjay Parikh, learned Senior Counsel appearing for theAppellant submitted that Section 5 (1) of the Act confers unguided anduncanalised power on the Central Government to specify anorganisation as an organisation of political nature not being politicalparty. He submitted that Rule 3(i), 3(v) and 3 (vi) which contain theguidelines and grounds, suffer from the vice of vagueness. Accordingto Mr. Parikh, Rules 3 (i), 3 (v) and 3 (vi) require to be declared asunconstitutional as they are vague, overbroad and unreasonable. Heurged that the vagueness in the said provisions leads to arbitraryexercise of power in violation of Article 14 of the Constitution. Hefurther submitted that an organisation, the activity of which is to educateand promote civil, political, social, economic and cultural rights cannotbe prevented from having access to funding, whether domestic orforeign. Curtailing the right of the Appellant-organisation in havingaccess to foreign funds would result in the violation of the fundamentalrights guaranteed under Articles 19(1)(a) and 19(1)(c) of theConstitution. He relied upon the International Covenant on Civil andPolitical Rights and International Covenant on Economic, Social andCultural Rights which have been accepted as sources of human rightsby the Protection of Human Rights Act, 1993. Mr.Parikh submittedthat political rights are an integral part of human rights and anyrestriction in exercise of political rights would be unconstitutional.

A4. Mr. K. M. Nataraj, learned Additional Solicitor Generalappearing for the Respondent defended the judgment of the High Courtby arguing that all the relevant points have been rightly adjudicated bythe High Court. He argued that the constitutional validity of statutecan be challenged only on two grounds which are legislativecompetence and violation of any of the fundamental rights guaranteedBunder Part III of the Constitution. Additionally, he submitted that asubordinate legislation can be challenged successfully only on the groundof the subordinate legislation being ultra vires the Act. The learnedAdditional Solicitor General contended that the Appellant organisationis not entitled to invoke Article 19 of the Constitution of India. AccordingCto him, Article 19 provides for fundamental rights which are guaranteedonly to citizens. The Appellant organisation cannot be considered as acitizen. Moreover, no individual member of the organisation has beenmade party to the Writ Petition or in this Appeal. In support of thissubmission, he relied upon judgments of this Court reported in TataEngineering and Locomotive Co. Ltd. v. State of Bihar[1] and ShreeDSidhbali Steels Ltd. vs. State of Uttar Pradesh[2]. According to thelearned Additional Solicitor General, right to receive foreign contributionis not fundamental right guaranteed under Article 19 of theConstitution. We were taken through the provisions of the Act and theRules by the learned Additional Solicitor General who submitted thatEsufficient safeguards against possible abuse of power are incorporatedin the Act and the Rules. That apart, it was contended that possibilityof abuse of power cannot be ground to challenge legislation. It wassubmitted that the object and purpose of the Act has to be taken intoconsideration by this Court while interpreting the provisions of the Act.The further submission on behalf of the Respondent was that theFprinciple of ‘reading down’ has to be adopted in case this Court is ofthe opinion that there is ambiguity in Rule 3 of the Rules.

5. It is imperative to refer to the statutory regime. The ForeignContribution (Regulation) Act, 1976 (hereinafter referred to as ‘the 1976Act’) was enacted to regulate the acceptance and utilization of foreignGcontribution or foreign hospitality by certain persons or associations witha view to ensure that parliamentary institutions, political associations,academic and other voluntary organisations as well as other individualsworking in important areas of national life may function in manner

1 (1964) 6 SCR 885H2 (2011) 3 SCC 193

consistent with the values of sovereign democratic republic and thematters connected therewith and incidental thereto. The backgroundin which the 1976 Act was made has been succinctly stated by theHigh Court of Delhi in Association for Democratic Reforms v. Unionof India[3] as follows:

“It can be safely gathered that amidst spate of subversiveactivities sponsored by the Foreign Powers to destabilize ournation, the Foreign Contribution (Regulation) Act, 1976 wasenacted by the Parliament to serve as shield in our legislativearmoury, in conjunction with other laws like the Foreign ExchangeRegulation Act, 1973, and insulate the sensitive areas of nationallife like - journalism, judiciary and politics from extraneousinfluences stemming from beyond our borders.”

6. In view of several deficiencies in the 1976 Act, fresh law inthe shape of the Foreign Contribution (Regulation) Act, 2010 was madeby repealing the 1976 Act. The introduction of the Act is as under:

“It had been noticed that some of the foreign countries werefunding individuals, associations, political parties, candidates forelections, correspondents, columnists, editors, owners, printers orpublishers of newspapers. They were also extending hospitality.The effects of such funding and hospitality were quite noticeableand to have some control over such funding and hospitality andto regulate the acceptance and utilisation of foreign contributionor foreign hospitality by certain persons or associations, with aview to ensuring that Parliamentary institutions, politicalassociations and academic and other voluntary organisations aswell as individuals working in the important areas of national lifemay function in manner consistent with the values of asovereign democratic republic the Foreign Contribution(Regulation) Act, 1976 (49 of 1976) was enacted.”

7. The long title of the 2010 Act indicates that it is made toconsolidate the law to regulate the acceptance and utilisation of foreigncontribution or foreign hospitality by certain individuals or associationsor companies and to prohibit acceptance and utilisation of foreigncontribution or foreign hospitality for any activities detrimental to thenational interest and for matters connected therewith or incidental

3 (2014) 209 DLT 609

Athereto. Section 3 of the Act prohibits acceptance of foreign contributionby the following:

(a) candidate for election;

(b) correspondent, columnist, cartoonist, editor, owner,printer or publisher of registered newspaper;

(c) Judge, Government servant or employee of anycorporation or any other body controlled or owned bythe Government;

(d) member of any Legislature;

(e) political party or office-bearer thereof;

(f) organisation of political nature as may be specifiedunder sub-section (1) of section 5 by the CentralGovernment;

(g) association or company engaged in the production orDbroadcast of audio news or audio visual news or currentaffairs programmes through any electronic mode, or anyother electronic form as defined in clause (r) of sub-section (1) of section 2 of the Information TechnologyAct, 2000 (21 of 2000) or any other mode of massEcommunication;

(h) correspondent or columnist, cartoonist, editor, owner ofthe association or company referred to in clause (g).

8. Section 5 thereof stipulates that the Central Government shallspecify an organisation as an organisation of political nature not beingFa political party as referred to in Section 3 (1) (f) having regard to theactivities of the organisation or the ideology propagated by theorganisation or association of the organisation with the activities of anypolitical party.

9. It is further provided in Section 5 (1) that the CentralGGovernment may by Rules frame guidelines specifying the ground(s)on which an organisation shall be specified as an organisation of apolitical nature. Section 48 (2) (d) empowers the Central Governmentto frame guidelines, specifying the ground(s) on which an organisationmay be specified as an organisation of political nature under SectionH5 (1). In exercise of power conferred under Section 48, the Central

Government framed the Foreign Contribution (Regulation) Rules, 2011.Rule 3 of the Rules, which is relevant for this case, is as follows:

“3. Guidelines for declaration of an organisation to be of politicalnature, not being political party. - The Central Government mayspecify any organisation as organisation of political nature on oneor more of the following grounds:

(i) organisation having avowed political objectives in itsMemorandum of Association or bylaws;

(ii) any Trade Union whose objectives include activities forpromoting political goals;

(iii) any voluntary action group with objectives of politicalnature or which participates in political activities;

(iv) front or mass organisations like Students Unions,Workers’ Unions, Youth Forums and Women’s wing ofa political party;

(v) organisation of farmers, workers, students, youth basedon caste, community, religion, language or otherwise,which is not directly aligned to any political party, butwhose objectives, as stated in the Memorandum ofAssociation, or activities gathered through other materialevidence, include steps towards advancement of Politicalinterests of such groups;

(vi) any organisation, by whatever name called, whichhabitually engages itself in or employs common methodsof political action like ‘bandh’ or ‘hartal’, ‘rasta roko’,‘rail roko’ or ‘jail bharo’ in support of public causes.”

10. plain reading of Section 3 of the Act shows that foreigncontributions should not be accepted by candidate in an election orby political party or office bearer thereof and member of anylegislature apart from Judges and Government servants and thosebelonging to the press, print and electronic media. As the dispute in thiscase revolves around the organisations which are not actively involvedin politics, it is necessary to focus on the provisions of the Act and theRules governing such organisations. Section 3 (1) (f) of the Act providesthat an organisation of political nature is also barred from receivingforeign contributions. Such an organisation of political nature may bespecified under Section 5(1) by the Central Government.

A11. Section 5 of the 1976 Act provides that any organisation ofa political nature not being political party shall not accept any foreigncontribution except with the prior permission of the Central Government.However, according to the 2010 Act, an organisation of political nature,as specified, is barred from accepting foreign contributions. Theprocedure to notify an organisation of political nature is prescribedBunder Section 5 of the 2010 Act. Before declaring an organisation tobe an organisation of political nature not being political party, theCentral Government shall take into account the activities of theorganisation or the ideology propagated by the organisation or theprogramme of the organisation or the association of the organisationCwith the activities of any political party. The Central Government isobligated in terms of Section 5 (2) of the Act, to issue notice in writinginforming the organisation in respect of which the order is proposed tobe made of the ground(s) on which an order under Section 5 (1) isproposed. As per Section 5 (3), the organisation is to be given anopportunity to submit its representation which shall be considered withinDthe time prescribed in Section 5 and an order is required to be passedrecording the reasons therefor.

12. Guidelines for declaration of an organisation to be anorganisation of political nature not being political party are found inRule 3 of the Rules. We are concerned with Rules 3 (i), 3 (v) and 3E(vi) of the Rules, which are the subject matter of challenge in this appeal.

13. The principal challenge of the Appellant-organisation to Section5 (1) of the Act is on the ground that the terms ‘activity, ideology andprogramme’ are vague and have not been defined in the Act whichresult in conferring unbridled and unfettered power on the executive.FTherefore, the Appellant-organisation contended that Section 5 (1) isviolative of Article 14 of the Constitution. Section 5 (4) is alsochallenged on the ground that the authority to whom representationshould be made has not been specified and it is not clear whether theauthority would be an independent authority or the Central GovernmentGitself. The High Court held that the words ‘activities of the organisation,the ideology propagated by the organisation and the programme of theorganisation’ having nexus with the activities of political nature areexpansive but cannot be termed as vague or uncertain. Sufficientguidance is provided by the Parliament in Section 5 and it is for therule making authority to lay down the specific grounds. We are inHagreement with the High Court that Section 5 (1) does not suffer from

the vice of vagueness inviting the wrath of Article 14. Section 5 (4)cannot be declared as unconstitutional only on the ground that theauthority to whom representation should be made is not specified. Itis relevant to note that no serious attempt has been made by theAppellant-organisation to assail Section 5 (4) of the Act.

14. The contention of the Appellant is that the guidelines in Rule3 of the Rules are vague giving scope for misuse and abuse of powerby roping in voluntary organisations within the sphere of the Act.Thereby, an organisation which has no interest in active politics can bedeprived of the right to receive foreign contribution at the whims andfancies of the executive by resorting to the vague guidelines in Rule 3.It was further submitted on behalf of the Appellant that the words‘political objectives’, ‘political activities’, ‘political interests’ and ‘politicalaction’ used in Rule 3 have no clarity and any activity though notconnected with party politics can be brought into the fold of Rule 3.Therefore, according to the Appellant-organisation, Rules 3 (i), 3 (v)and 3 (vi) suffer from the vice of over-breadth and are liable to bedeclared as unconstitutional being violative of Article 14. According tothe Appellant-organisation, there is an infraction of Article 19 of theConstitution as the Rules are also unreasonable and violate the freedomof speech and expression and the right to form associations protectedunder Article 19 (1) (a) and 19 (1) (c) of the Constitution.

15. We find force in the objection taken on behalf of the Unionof India that the Appellant-organisation is not entitled to invoke Article19. No member of the Appellant-organisation is arrayed as party.Article 19 guarantees certain rights to ‘all citizens’. The Appellant,being an organisation, cannot be citizen for the purpose of Article 19of the Constitution. (See: State Trading Corporation of India Ltd. V.The Commercial Tax Officer, Visakhapatnam, (1964) 4 SCR 99;Bennett Coleman & Co. v. Union of India, (1972) 2 SCC 788 andTata Engineering and Locomotive Ltd. v. State of Uttar Pradesh,(2011) 3 SCC 193). In the absence of any member of the associationas petitioner in the Writ Petition, the Appellant-organisation cannotenforce the rights guaranteed under Article 19 of the Constitution.

16. The principal contention of the Appellant-organisation is thatthe guidelines provided in Rule 3 are vague and confer naked anduntrammeled power on the executive thereby giving the scope for

Aarbitrary exercise of power. In K. A. Abbas v. Union of India[4] thisCourt was of the opinion that:

“46. The real rule is that if law is vague or appears to be so,the court must try to construe it, as far as may be, and languagepermitting, the construction sought to be placed on it, must be inBaccordance with the intention of the legislature. Thus, if the lawis open to diverse construction, that construction which accordsbest with the intention of the legislature and advances the purposeof legislation, is to be preferred. Where however the law admitsof no such construction and the persons applying it are in aCboundless sea of uncertainty and the law prima facie takes awaya guaranteed freedom, the law must be held to offend theConstitution, this is not application of the doctrine of due process.The invalidity arises from the probability of the misuse of the lawto the detriment of the individual. If possible, the Court insteadof striking down the law may itself draw the line of demarcationDwhere possible but this effort should be sparingly made and onlyin the clearest of cases”.

17. It is settled principle of interpretation that the provisions ofthe statute have to be interpreted to give the words plain and naturalmeaning. But, if there is scope for two interpretations, the Courts haveEpreferred purposive construction, which is now the predominant doctrineof interpretation[5]. In case of ambiguity in the language used in theprovision of statute, the Courts can take aid from the historicalbackground, the Parliamentary debates, the aims and objects of the Actincluding the long title, and the endeavour of the Court should be toFinterpret the provisions of statute to promote the purpose of the Act.(See: Chiranjit Lal Chowduri v. Union of India, (1950) SCR 869;Union of India v. Elphinstone Spinning and Weaving Co. Ltd.,(2001) 4 SCC 139).

18. The object sought to be achieved by the Act is to ensure thatGParliamentary institutions, political associations and academic and othervoluntary organisations as well as individuals working in the importantareas of national life should function in manner consistent with the

4 (1970) 2 SCC 780H5 Shailesh Dhairyawan v. Mohan Balkrishna Lulla, (2016) 3 SCC 619

values of sovereign democratic republic without being influenced byforeign contributions or foreign hospitality. The long title of the Actmakes it clear that the regulation of acceptance and utilisation of foreigncontribution is for the purpose of protecting national interest. Candidatesfor election and political parties or office bearers of political parties arebarred from accepting any foreign contribution. The legislative intentis also to prohibit organisations of political nature from receiving foreigncontributions. It is clear that preventing foreign contribution into thepolitical arena is the object sought to be achieved by the Act.Prevention of foreign contributions routed through voluntaryorganisations which are not connected to party politics is the reasonbehind introduction of Section 3 (1) (f) and Section 5 of the Act. TheCentral Government is required to take into account the activities,ideology or the programme of the organisation including the associationof the organisation with activities of any political party before declaringan organisation as an organisation of political nature not being politicalparty. Guidelines that are prescribed by the Rules indicate that onlythose organisations which are actively involved in politics or associatedwith political parties can be declared as organisations of politicalnature. The question that falls for our consideration is whether theguidelines in Rule 3 suffer from vagueness and ambiguity and whetherthey can be stated to be conferring uncanalised power on the executive.According to Rule 3 (i) an organisation having avowed politicalobjectives in its memorandum of association or bye laws is anorganisation of political nature. As the intention of the legislature isto prohibit foreign funds in active politics, an Association with avowedpolitical objectives (i.e. to play role in active politics or party politics)cannot be permitted access to foreign funds. There is no ambiguity inthe provision and hence, cannot be termed as vague. Therefore, wefind no substance in the contention of the Appellant that Rule 3 (i) isultra vires the Act.

19. Rule 3 (v) deals with organisations of farmers, workers,students etc. which are not directly aligned to any political party butobjectives of which include steps towards advancement of ‘politicalinterests’ of such groups. The submission made on behalf of theAppellant is that such organisations agitating for their legitimate claimscannot be prevented access to foreign funds by resorting to the vagueterm ‘political interests’. We are in agreement that the words ‘political

Ainterests’ are vague and are susceptible to misuse. However, possibleabuse of power is not ground to declare provision unconstitutional[6].

20. Where the provisions of statute are vague and ambiguousand it is possible to gather the intention of the legislature from the objectof the statute, the context in which the provisions occur and purposeBfor which it is made, the doctrine of “reading down” can be applied[7].To save Rule 3(v) from being declared as unconstitutional, the Courtcan apply the doctrine of “reading down”.

21. balance has to be drawn between the object that is soughtto be achieved by the legislation and the rights of the voluntaryCorganisations to have access to foreign funds. The purpose for whichthe statute prevents organisations of political nature from receivingforeign funds is to ensure that the administration is not influenced byforeign funds. Prohibition from receiving foreign aid, either directly orindirectly, by those who are involved in active politics is to ensure thatthe values of sovereign democratic republic are protected. On theDother hand, such of those voluntary organisations which have absolutelyno connection with either party politics or active politics cannot be deniedaccess to foreign contributions. Therefore, such of those organisationswhich are working for the social and economic welfare of the societycannot be brought within the purview of the Act or the Rules byenlarging the scope of the term ‘political interests’. We are of theEopinion that the expression ‘political interests’ in Rule 3 (v) has to beconstrued to be in connection with active politics or party politics.

22. Any organisation which habitually engages itself in or employscommon methods of political action like ‘bandh’ or ‘hartal’, ‘rasta roko’,‘rail roko’ or ‘jail bharo’ in support of public causes can also be declaredFas an organisation of political nature, according to the guidelineprescribed in Rule 3 (vi). Support to public causes by resorting tolegitimate means of dissent like bandh, hartal etc. cannot deprive anorganisation of its legitimate right of receiving foreign contribution. Itis clear from the provision itself that bandh, hartal, rasta roko etc., areGtreated as common methods of political action. Any organisation whichsupports the cause of group of citizens agitating for their rights withouta political goal or objective cannot be penalized by being declared asan organisation of political nature. To save this provision from being

6 Collector of Customs v. Nathella Sampathu Shetty, (1962) 3 SCR 786.

7 DTC v. Mazdoor Congress, 1991 Supp (1) SCC 600

declared as unconstitutional, we hold that it is only those organisationswhich have connection with active politics or take part in party politics,that are covered by Rule 3 (vi). To make it clear, such of thoseorganisations which are not involved in active politics or party politicsdo not fall within the purview of Rule 3 (vi). We make it clear thatorganisations used for channeling foreign funds by political parties cannotescape the rigour of the Act provided there is concrete material. Inthat event, the Central Government shall follow the procedure prescribedin the Act and Rules strictly before depriving such organisation the rightto receive foreign contributions.

23. The appeal is disposed of accordingly.

Devika Gujral

Appeal disposed of.