This was done under the provisions of the Foreign Contribution Regulation Act (FCRA), 2010 for alleged diversion of funds to activities and expenses other than they were meant for, a Home ministry official said here.
The order shall be enforced “with immediate effect”, the official said.
In the three-page communique to the chief functionary of Mumbai-based Sabrang Trust, the Union Home Ministry said there were six points of violations of the charter of FCRA norms by the organisation and that included “mixing of domestic and foreign funds by the association and is liable to be treated as misutilisation of foreign contribution”.
The government had earlier “suspended” the FCRA license of the trust run by Setalvad, who has been vocal against Prime Minister Narendra Modi for his role as the Chief Minister of Gujarat during the 2002 anti-Muslim mayhem in the state.
Among other cases, Setalvad was especially instrumental in shifting the trial of Best Bakery carnage of 2002 involving Zaheera Sheikh and others out of Gujarat to Mumbai.
The provisions of FCRA, which was also amended in 2011 under the UPA government, regulates the foreign funding of the NGOs registered in India.
“Sabrang Trust foreign funding was suspended about nine months back in September 2015 after it was found that there were violations of the FCRA law,” a source told IANS.
The Union Home Ministry began a comprehensive probe in April 2015 against a number of NGOS including Sabrang.
Sabrang Trust was registered under FCRA and registered to work in education and social sectors, it said adding in financial year 2007-08, the organisation had received Rs 1,52,593 as “foreign contribution” for “maintenance of place of historical and cultural importance” and out of this, Rs 50,000 was used for “other expenses”.
“This indicated that the association has received the fund for purpose which is not permitted as per mandate of registration certificate, and therefore, has violated the mandate of registration certificate,” said the communique.
Among other charges, the government said “after careful examination” and personal hearing, it was found that the explanation “was not satisfactory” and “did not provide adequate explanation vis-a-vis the violations found”.
The replies and explanations “did not contain any such material” that would justify the withdrawal of the show cause notice served to the trust on September 9, 2015, it said.
“The association (Sabrang Trust) has incurred more than 50 per cent of the foreign contribution on administrative expenditure during 2010-11 (64.23 per cent) and 2011-12 (55.14 per cent) without obtaining the prior approval of the central government, which is in violation of section 8(1) (b) of FCRA 2010,” the Home Ministry letter said.
The allegations from government also said that the trust has made “direct payments of Rs 12 lakh from the FCRA designated account to Citi Bank and Union Bank of India on account of credit cards belonging to Teesta Setalvad and Javed Anand respectively”.
“Besides, it has been seen from the accounts that the foreign contributions has been frequently used for items of personal expenses – example – for dining in hotels, food and takeaways ordered at their residence,” the missive said.