AAP's overseas donations: Open, transparent but relies on 'good faith'

New Delhi: The lawyer, whose PIL led the government to direct a probe into Aam Aadmi Party’s funding, today claimed that after the inquiry concludes on 10 December, all the 70 candidates of the party will be convicted for using foreign funds for their electoral campaign before the Delhi Assembly election. The lawyer, ML Sharma who again filed an affidavit in the Delhi high court against Aam Aadmi Party on Saturday, claimed that all 70 candidates are using the foreign funds for their campaign. Citing the Foreign Exchange Management Act (FEMA), Sharma claims any donation made by Indian citizens who has lived in the country for less than 180 days, is foreign money. “In that case they are not liable to the taxation policies of the Indian government. So it’s foreign money,” claimed Sharma. [caption id=“attachment_1239643” align=“alignleft” width=“380”]  Arvind Kejriwal. Reuters.[/caption] The AAP leadership, though, on Tuesday rubbished the claims that its electoral campaign was being funded by foreign money. Today the party is sending its answers to a questionnaire sent by the government inquiring into the party’s sources of foreign donations. The Ministry of Home Affairs sent a questionnaire to the Aam Aadmi Party under a Delhi High Court directive after M L Sharma filed a PIL against the party. The PIL stated that foreign donations were received for its electoral campaign before the Delhi Assembly election, due on 4 December; hence it’s a crime under the Foreign Contribution Regulation Act (FCRA), which clearly says that usage of any foreign donation is prohibited for political parties in India. “Thirty per cent of our donations have come from Indian citizens living abroad and all the payments have been channelised through the banks, so there is no question of discrepancy and everything is transparent,” says Pankaj Gupta, a national executive of AAP. “It’s mandatory for the overseas donor to prove their Indian citizenship before making a transaction,” he adds. Countering Sharma’s citation of FEMA, AAP said that FEMA will be used for the taxation on foreign exchange but not on donation made by Indian citizens. “The overseas donation we received are all by indian citizens so FEMA, FCRA both are not in use here,” says an AAP spokesperson. AAP’s claim that there have been no irregularities in its funding under FCRA is seconded by Shivani Kapoor of Association for Democratic Reforms (ADR). “Any money donated by foreign government, organizations, MNC and foreign nationals is considered foreign money. Even donation from bodies like UN or UNICEF is foreign money but if it’s made by citizens holding Indian passport, it cannot be foreign money, hence FCRA is not violated,” she says. “Even after the 2011 amendments to the act, any money donated by Indian passport holders is not foreign money,” The ACT which was passed in 1976 clearly says that taking any foreign donation of is prohibited for political parties. ButAAP claims that all its foreign donation has been made by NRIs who holds an Indian Passport. “Total 7000 NRIs have donated so far and we have their passport details that prove that they are all Indian nationals,” says an AAP party worker. But even with this claim, the party can do precious little to check if the donor has a valid passport as the only requirement for making a donation is to put out the passport number. “People donate money in good faith. So we cannot make mandates that might discourage them. And if someone is donating despite not having a valid passport then we cannot do anything,“says Gupta. “But why Rs 19 crore is being talked about so much when a party like Congress has a funding of Rs 2300 crore? We will be unfazed and the election results will talk for us,” he says. One thing that goes in AAP’s favour now that it has not accepted any donation through direct money transfer agencies like PayPal or Western Union. “Under the FEMA, it is completely prohibited to receive donation money through a direct transfer through agencies like Western Union. All the transaction has to be done through an RBI authorised national bank. In case of transaction through bank, it does not matter even if the donor does not live in India for 180 days or more and the donation is legal,” says Meet Malhotra, a Supreme Court lawyer. On the deadline for sending the answers, the party claims that the PIL has no merit and it’s just been a ploy to harass the party which make steep rise in terms of popularity since its inception in the political arena a year ago. “The PIL does not stand any chance. The questions were so weak that it took us only a day to answer them,” informs Gupta, however, he refused to reveal the questions.