Supreme Court judgment on plea to transfer of funds from PMCARES to NDRF to fight COVID19

The Supreme Court dismisses plea while answering 5 questions formulated by the Bench.
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The PM Cares Fund set up by the central government is not in violation of the Disaster Management Act (DM Act) of 2005, the Supreme Court ruled on Tuesday, rejecting a plea seeking transfer of all contributions made to PM Cares Fund till date to the National Disaster Response Fund (NDRF), a statutory fund created under said act.

A three-judge bench headed by justice Ashok Bhushan held that the two funds can exist separately and individuals and organisations are free to contribute to NDRF but funds from PM Cares need not be transferred to NDRF.

“PM Cares Fund is an entirely different fund established as a public charitable trust. Funds in PM Cares cannot be directed to be deposited to NDRF,” the bench, which also comprised justices R Subhash Reddy and MR Shah, ruled.

Further, the court also turned down a prayer seeking formulation of a national plan for Covid management stating that the existing plan under the DM Act is sufficient to deal with the pandemic.

The petitioner NGO, Centre for Public Interest Litigation (CPIL), had claimed that PM Cares Fund was set up in violation of the legal mandate under the DM Act as per which any grant made by any person or institution for the purpose of disaster management should be compulsorily credited to NDRF.

Reacting to the Supreme Court verdict, CPIL lawyer, advocate Prashant Bhushan tweeted, “Unfortunate that the SC allows the non-transparent and unaccountable PM Cares fund set up as a secret trust to garner money in the name of Covid relief, rather than transferring such funds to the Statutory NDRF which is accessible under RTI and audited by CAG.”

“Now that the Supreme Court has adjudicated on the matter, we hope that the attack on the PM Cares Fund ends conclusively,” BJP spokesperson and Supreme Court advocate, Nalin Kohli told HT.

The PM Cares Fund was set up by the Centre on March 28 as a public charitable trust with the primary objective of dealing with any kind of emergency or distress situation such as that posed by Covid-19 pandemic.

“Even though there is a provision for NDRF under Section 46 of the Disaster Management Act, the central government has come up with a PM Cares Fund. All the contributions being made by individuals and institutions in relation to Covid-19 crisis are being credited into the PM Cares Fund and not to the NDRF, in clear violation of Section 46 of the DM Act,” the petitioner submitted.

On the necessity of national plan for Covid management, the petitioner had placed reliance on section 11 of DM Act.

“Section 11 of the DM Act makes it mandatory for a national plan to be drawn up for disaster management for whole of the country but currently, there is no such national plan in place to deal with the ongoing COVID-19 pandemic even though the same has been notified as a ‘disaster’ and numerous notifications are being issued to contain the same under the DM Act”, the petitioner had pointed out.

In its affidavit before the top court in July 8, the Centre had rebutted this argument by stating that PM Cares is a fund established to carry out relief work and several such funds have been established on similar lines in the past.

“Mere existence of a statutory fund (NDRF) would not prohibit creation of a different fund like PM Cares Fund which provides for voluntary donations,” the affidavit said.

During the hearing before the apex court, the Centre, through solicitor general Tushar Mehta, had defended the PM Cares fund saying that it was not intended to circumvent the NDRF as alleged by the petitioners.

“Whatever amount that has to go to NDRF under the law will go (to NDRF). PM Cares is a public charitable trust. If private individuals want to donate, they can do so. There are several public charitable trusts getting donations,” Mehta argued.

The petitioner through their counsel, senior advocate Dushyant Dave, had pointed out that PM Cares Fund was not being audited by the Comptroller and Auditor General (CAG) but by private auditors.

“This government believes in transparency. Why should private auditors audit it (PM Cares)? NDRF, under DM Act, is audited by CAG,” Dave said.

The bench had reserved its judgment in the case on July 27.

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