KOCHI: The Kerala High Court on Monday directed the CBI to inform whether funds received by Unitac as part of the Life Mission housing project fall under the definition of foreign contribution under the Foreign Contribution (Regulation) Act. The court asked whether the mission and the company are exempted from the Act.
Justice VG Arun sought clarification from the CBI when the petition filed by Santhosh Eappen, MD of Unitac and an accused in the case, seeking to quash the FIR registered against him came up for hearing.
Opposing the plea, the CBI submitted that the Life Mission comes under the purview of the Act which was violated as there have been kickbacks. The petitioner himself stated in the petition that he had handed over crores of rupees to several persons following the instructions of Swapna Suresh, a key accused in the gold smuggling case being probed by the NIA, the Customs, and the Enforcement Directorate.
The foreign contribution should be utilised in a proper manner and not for any other purpose for obtaining such exemption, it said. The CBI has to investigate whether the money was transferred to officials of the Life Mission. Hence the investigation should go on.
Citing the petition filed by Eappen, the CBI submitted that the petitioner stated that on August 2, 2019, he reached Thiruvananthapuram around 6.30 pm and was asked to come near the Cafe-Coffee Day outlet in Kowdiar. After some time, Khalid, an Egyptian, working as economic head of the UAE Consulate, came in a vehicle from the Consulate with a blue number plate and collected the entire amount from him, the CBI said.
"The amount was given as per the direction of the Consulate General. Further, an amount of Rs. 68 lakhs was transferred to ‘ISOMO’ trading company owned by Sandeep Nair for its liaison work. This clearly reveals that there has been a kickback," the CBI pointed out.
Abhilash KN, the petitioner’s counsel, argued that foreign funds received by Unitac as part of its business are exempted from foreign contribution regulation and that Life Mission is an exempted organization as it is in the government sector. It is on the basis of an MoU signed by Life Mission, an exempted organization, that funds were transferred to Unitac and therefore, it has not violated the FCRA, the counsel argued. The complaint does not disclose any offences and it contains allegations without any substance, he added.
The term foreign contribution is explained in Section 2 (h) of the Act and the contribution received towards the cost of goods/service rendered cannot be considered as foreign contribution as per the third explanation of section 2 (h) of the Act. The petitioner is rendering service under a contract and the cost received for that service would not come within the definition of foreign contribution and therefore he cannot be prosecuted under section 3 of the Act, said the petition.
Even if it is assumed that the petitioner accepts a foreign contribution, such receipt of the contribution is exempted under section 4 of the Act, which says that section 3 is not applicable if a person accepts foreign contribution as an agent of a foreign source in relation to any transaction made by such foreign source with the central government or state government, it added.
In this case, already there was a memorandum of understanding between the Red Crescent and state government. The petitioner also argued that the investigation was initiated without any consent from the state government, necessitated as per section 6 of the Delhi Special Police Establishment Act.
The petition stated that in addition to the transfer of amount, Swapna Suresh demanded five iPhones from the petitioner for presenting those articles to the chief guest and other delegates of the National Day celebration of UAE. The phones were handed over to Swapna Suresh as demanded. Those phones were presented to Ramesh Chennithala and others in the function. Chennithala was the chief guest, he alleged.