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SHOULD PM CARES FUND DIVULGE INFORMATION TO THE PUBLIC?

Author: Naganathan Ramaswamy Iyer, III year of B.A.,LL.B.(Hons.) from SASTRA Deemed University


Author’s Note

This article dwells on the rudimentary set-up of the PM CARES Fund and answers the question as to whether or not the PM CARES Fund should divulge information to the Public by interpreting the provisions of law and bringing about a different approach that lays the foundation to the uniqueness of this article.


An Introduction to the PM CARES Fund

The Coronavirus disease (known as COVID-19) has drastically altered the lives of people across the globe. It has shattered world economies and destabilized the living standards of people. It has forced countries to take up extreme measures which were economically unstrategic but were essential for preventing the spread of the disease. India was one such country that went into a state of a nationwide lockdown, whereby production activities were momentarily stopped and the movement of people was restricted within their homes. Unfortunately, this could only curb the spread of the disease to a merger limit. India is a large country with a population of over 130 crore and it is physically impossible to curb the spread of the disease due to the lack of resources and infrastructures. Currently, India is the 3rd worst affected country in the world and we are standing in line to become the worst affected country. The worst is yet to come and we have to understand the fact that we do not have the infrastructure and resources to manage such a catastrophic situation.


On April 21, the Government of India announced that Rs 15,000 crore has been allocated to the health sector.[i] The Indian economy has degraded over the past few months and the COVID-19 situation threatens the economic growth of the country. The Government could not afford to allocate additional reserves for the healthcare sector.


In a view to generating funds purely for improving the COVID-19 situation, the PRIME MINISTER’S CITIZEN ASSISTANCE AND RELIEF IN EMERGENCY SITUATION Fund (PM CARES Fund) were constituted. The PM CARES fund was set up on the 27th of March, 2020 under the Registration Act, 2008 as a Public Charitable Trust[1]. The main objective of setting up the PM CARES fund was to render financial support to those affected by the coronavirus pandemic, increase the supply of medical equipment and invest in vaccine development. The PM CARES Fund accepts voluntary contributions by individuals/organizations as well as contributions as part of CSR from Companies/Public Sector Undertakings (PSUs). Just like other trusts, the PM CARES Fund consists of a board in which the Prime Minister is the ex-officio chairman of the board and the Defence Minister, Finance Minister and Home Minister are the ex-officio trustees of the board. The Chairman of the Board of Trustees (i.e the Prime Minister) has the power to nominate three trustees to the Board of Trustees who shall be eminent persons in the field of research, health, science, social work, law, public administration and philanthropy[ii].


The trustees thus appointed shall have the following responsibilities:

(a) Fulfilling the objectives of the Trust

(b) Managing the funds and ensuring the proper application of the Trust Property

(c) Preparing and submitting all records as specified by law [2]


The Difference between PM CARES Fund and PM National Relief Fund

One of the first questions raised by the opposition party as well as the general public was that, why was the PM CARES fund created, when the PM’s National Relief Fund (PMNRF) was already present?


Even though the PM CARES fund and the PMNRF may look similar, there are some significant differences between the two. Firstly, the PM CARES fund was specially set up to raise funds for the COVID-19 situation, whereas the PMNRF was a broader fund base that was set up to support families who are affected by natural disasters and calamities and also to help out migrant residents of the country. The second distinction is on the managing committee of the fund. The PMNRF is headed by the Prime Minister and all the decisions are made at his discretion. On the other hand, the PM CARES fund consists of a team in which the Prime Minister is the ex-officio chairman and the Home Minister, Finance Minister and the Defence Minister are the ex-officio trustees. Thirdly, the donations made by private companies and organizations would be considered as a Corporate Social Responsibility and would be exempted from tax in case of the PM CARES fund, whereas, donations under the PMNRF would not constitute a component of Corporate Social Responsibility. Hence, there is no fault in forming a separate fund in supporting the current situation.


Should the PM CARES fund divulge information as per the Right to Information Act, 2005

The Right to Information (RTI) Act was passed in the year 2005 with the main objective of having a corruption-free government and also to imbibe the concept of Public Accountability. The main objective of this act was to make a mandate for all governmental and public organizations to divulge information of their balance sheets, accounts and other essential details to the general public.


Section 3 - Section 11 of the Right to Information Act, 2005 lays out extensive guidelines for the divulgence of information by public authorities and all officials under such authorities.


Taking into account the PM CARES fund as a Public Charitable Trust[iii], is it not the duty of the PM CARES fund to furnish necessary information to the general public?


It is pertinent to understand the RTI Act before arriving at an answer. The RTI act lays out a necessary condition of an organization being a public authority before furnishing information. Section 2(h) of the RTI Act lays out the conditions for an organization to fall under the category of public authority.


Section 2(h) of the RTI Act reads as follows,

“public authority" means any authority or body or institution of self-government established or constituted—

(a) by or under the Constitution;

(b) by any other law made by Parliament;

(c) by any other law made by State Legislature;

(d) by notification issued or order made by the appropriate Government,

and includes any—

(i) body owned, controlled or substantially financed;

(ii) non-Government organisation substantially financed,

directly or indirectly by funds provided by the appropriate Government;”[iv]


Two conditions have to be fulfilled to constitute a public authority under the scope of section 2(h) of the RTI Act. About the PM CARES fund, the fund has been registered under the Registration Act, 2008. Hence the first condition under section 2(h) has been fulfilled because the Registration Act, 2008 comes under section 2(h)(b)[v] as a law made by the Parliament.


However, the PM CARES fund has mentioned that it doesn’t get any budgetary allocation, i.e there is no Government funding for the fund. This is in opposition to the second condition as per section 2(h) which stresses the fact that there must be funding from the Government. Since only the first condition has been fulfilled in respect of the PM CARES fund, it doesn’t fall under the ambit of a public authority under the RTI Act.


A writ petition had been filed with the intent of being sustained as a Public Interest Litigation by the counsel for the petitioner in the case Dr. Surender Singh Hooda vs PM CARES Fund[vi]. The Delhi High Court dismissed this writ petition which sought that the PM CARES fund was a public authority under the RTI Act.


Hence, it is evident that the PM CARES fund does not constitute a public authority under the RTI Act. Using this fact, the PM CARES refused to furnish information as and when required and stated that a private auditing firm has been employed after which the information will be revealed.


But, can we only rely on the RTI Act for furnishing information? Are there any other provisions or rules through which the information can be furnished?


A different approach to the PM CARES Fund

We all know that the PM CARES Fund has been registered as a Public Charitable Trust under the Registration Act, 2008.[vii] A Public Charitable Trust is one created for the advancement of education, promotion of public health, relief of poverty, and the benefit of the public at large.[viii]


The Indian Trusts Act, 1882 is formidable legislation for governing Trusts across the country. The Indian Trust Act states that its purpose is only for Private Trusts, but when a Public Trust comes into a territory or region which does not have a Public Trust law of its own, it is governed by the Indian Trusts Act, 1882. Certain State Governments have enacted the Public Trusts Act of their own, but individual Public Trusts Act of individual States cannot be applied to the PM CARES Fund and hence the Indian Trusts Act, 1882 applies to the PM CARES fund.


Section 19(b) of the Indian Trusts Act, 1882 states that the trustee at the request of the beneficiary at all reasonable times should furnish him with full and accurate information as to the amount and state of the trust-property.[ix]


According to section 3 of the Indian Trusts Act, 1882, a trustee is a person who accepts the confidence of the trust[x] and the beneficiary is the person for whose benefit the confidence of the trust has been accepted[xi].


In the PM CARES fund, the trustees are the Defence Minister, the Home Minister and the Finance Minister. The PM CARES fund was formed for the benefit of the general public at large by providing financial assistance for those affected by the Coronavirus. The Honorable Supreme Court in the case of Mahant Ram SaroopDasji v. S.P. Sahi Special[xii] has stated that the beneficiaries of a Charitable Trust are the general public. Even the Uttarakhand High Court in the matter of Sanjay Agarwal v. D.J. Haridwar and Anr.[xiii] has stated that a mass of the general public would constitute the beneficiaries in a charitable trust. Therefore, taking into account that the PM CARES Fund is a Public Charitable Trust, it is rudimentarily true that the beneficiaries of the PM CARES Fund are the general public.


The Madras High Court in the case of M.G. Devasaimyam v. Sir John D’Monte Trust[xiv] has stated that the trustee must furnish information to the beneficiary in the case of a Charitable Trust. Therefore, as per section 19(b) of the Indian Trusts Act, 1882, the Board of Trustees of PM CARES Funs should divulge information at the request of the public who are the beneficiaries.


Conclusion

From the above discussion, it is clear that even though the PM CARES Fund does not constitute a public authority as per the Right to Information Act, 2005, it is a Public Charitable Trust that is duty-bound to its beneficiaries who are the general public to furnish necessary information at their request as per the mandate of the Indian Trusts Act, 1882. Hence the Board of Trustees of the PM CARES Fund must reveal all the necessary details to the general public as stated by the law.


Moreover, the honourable Supreme Court must take into account the Indian Trusts Act, 1882 and the related provisions from it and apply them to the PM CARES Fund and provide necessary guidelines to the Board of Trustees of the PM CARES Fund directing them to furnish the information at the request of the public to avoid any conflicts in the future.


[i]PM CARES, https://www.pmcares.gov.in/en/web/page/faq.

[ii]PM CARES, https://www.pmcares.gov.in/en/web/page/faq.

[iii]PM CARES, https://www.pmcares.gov.in/en/web/page/faq.

[iv]Right to Information Act, 2005, s 2(h), No. 22, Acts of Parliament, 2005 (India).

[v]Right to Information Act, 2005, s 2(h)(b), No. 22, Acts of Parliament, 2005 (India).

[vi]Dr. Surender Singh Hooda v. PM CARES Fund, 2020 SCC OnLine Del 641.

[vii]PM CARES, https://www.pmcares.gov.in/en/web/page/faq.

[viii]Sylvine, Laws Applicable to A Public Trust in India, iPleaders, https://blog.ipleaders.in/laws-applicable-public-charitable-trust-india/#:~:text=Trust%20created%20for%20the%20advancement,the%20benefit%20of%20the%20public.

[ix]The Indian Trusts Act, 1882, s 19(b), No. 2, Acts of Parliament, 1882 (India).

[x]The Indian Trusts Act, 1882, s 3, No. 2, Acts of Parliament, 1882 (India).

[xi]The Indian Trusts Act, 1882, s 3, No. 2, Acts of Parliament, 1882 (India).

[xii]Mahant Ram SaroopDasji v. S.P. Sahi Special, 1959 AIR 942, 1959 SCR Supl. (2) 503.

[xiii]Sanjay Agarwal v. D.J. Haridwar and Anr., Writ Petition (M/S) No. 105 of 2007.

[xiv]M.G. Devasaimyam v. Sir John D’Monte Trust, 2011 SCC OnLine Mad 1255 : (2011) 4 LW 722 : (2012) 1 MWN (Civil) 318.

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