• Notification Date: 09-01-2024
• Notification No: N/A

Think Tank CPR: SC Dismisses Income Tax Dept Appeal against HC Stay on Proceedings Under FCRA

The Supreme Court has dismissed the Income Tax (I-T) Department’s appeal against a stay granted by the Delhi high court in favour of the 50-year-old, reputed think tank, Centre for Policy Research (CPR) in respect of cancellation of its registration under Section 12A of the Income Tax Act. 

“In view of the fact that the order impugned is interim in nature, we are not inclined to interfere with the impugned judgment passed by the high court,” stated a division bench of Justices P.S. Narasimha and Aravind Kumar. 

Established in 1973, Centre for Policy Research, or CPR, one of India’s most respected and oldest think tank and research centres, has been targeted on multiple scores, and scholars and academics globally have protested moves that appear shrouded in talk of irregularities, but smack of vendetta appear to be well in sync with democratic backslide that has squeezed civil society in the extreme. In March last year, in an open letter, top academics from universities in the US, the UK, Europe, and Australia had said they are “shocked and dismayed” at the government action. Calling CPR “one of India’s oldest and most esteemed policy research institutions”, the signatories say it has a “reputation for excellence that is second to none among international scholars”. Signatories included Adam Tooze, Daniel Honig, Christophe Jaffrelot, Alpa Shah, Filippo Osella (who was deported from India despite having a valid visa) and others. 

CPR’s Foreign Contribution (Regulation) Act (FCRA) licence was suspended last year, crippling its ability to ensure funding for research. Questions were then asked if research done by CPR on the ecology, impacting on the mega business group perceived to be close to Prime Minister Modi and the Bharatiya Janata Party, Adani could be linked with the Modi government’s actions against the think tank. The IT department’s notice to CPR had prominently cited CPR’s “ties with an NGO in Chhattisgarh that has been associated with protests against mining in Hasdeo. What the notice, however, did not state is that Hasdeo is the site of a massive Adivasi movement against the Adani Group for over a decade.” 

CPR had moved the Delhi high court of Delhi against the I-T department’s order, which sought to cancel its registration under Section 12A with retrospective effect, thereby taking away its tax exemption status, as per reports. It was represented by senior advocate Arvind P. Datar, who argued that cancellation of registration could have been ordered only for the previous year in which the violation was noticed, and if at all, for “subsequent previous years”. It was urged that the impugned order cancelled registration for several financial years, while dealing with “issue-wise” purported violations, which infracted Section 12AB(4)(ii) of the Act. 

Datar had also raised the issue of “violation of principles of natural justice” before the high court, contending that CPR was not given the opportunity to cross-examine persons whose statements were recorded by the revenue and relied upon in its order. “Further, it was highlighted that in connection with a show cause notice, no personal hearing was granted.” 

The Delhi high court will hear the case next on January 16.