NEW DELHI — On completion of the probe by the adjudicating authority of ED, the federal probe agency on Friday issued a show-cause notice to Amnesty India International Pvt. Ltd. (AIIPL) with a penalty of Rs 51.72 crore, while its former CEO Aakar Patel has been fined Rs 10 crore for “contravention” of the provisions of FEMA.
The ED said it has issued a penalty of over Rs 61 crore against Amnesty India and its former head Aakar Patel over charges of violation of the Foreign Exchange Management Act (FEMA).
The ED had initiated investigation under FEMA on the basis of allegations that Amnesty International, UK had been remitting huge amount of foreign contribution through its Indian entities via Foreign Direct Investment (FDI) route in order to evade Foreign Contribution Regulation Act (FCRA) to expand its NGO activities in India.
As per the federal probe agency, London-based Amnesty International sent a “huge amount” of foreign contribution to its Indian entities (AIIPL) “in guise of business activities to escape FCRA scrutiny”, say media reports.
However, Aakar Patel said they will challenge the ED action in court. “The ed is the govt not the judiciary. we will fight it (again) and win (again) in court,” he tweeted through a handle which is unverified, according to PTI.
The agency said it initiated a FEMA probe on the basis of information that Amnesty International, UK had been remitting “huge amount” of foreign contribution through its Indian entities (non-FCRA companies) following FDI (foreign direct investment) route, in order to evade FCRA to expand its NGO activities in India.
This was sent, it said, despite the “denial” of prior registration or permissions to Amnesty International India Foundation Trust (AIIFT) and other trusts under the FCRA by the Ministry of Home Affairs (MHA).
“During the period between November 2013-June 2018, remittance which was received by AIIPL and claimed as receipt for business/management consultancy and public relation services for export of services to foreign beneficiary is nothing but amount borrowed from overseas remitter, thereby violating the FEMA provisions,” it said.
The adjudicating authority, after getting detailed reply from AIIPL and following principle of natural justice, held that “AIIPL is an umbrella entity under Amnesty International Ltd., UK, which was declared to be set up for the cause of social activities in India”.
“However, AIIPL has involved in many activities which are not relevant to their declared commercial business, and circumventing model has been applied by them to route the foreign funds in the guise of business activities to escape FCRA scrutiny,” the statement said.
All contentions and submission from AIIPL regarding the claim of the remittance towards the export of services to Amnesty International have been dismissed, in the “absence of” concrete evidence, the ED said.