[PM CARES] Can anyone argue it is not 'State?': Shyam Divan to Delhi High Court

The Delhi High Court on Wednesday began hearing a plea to include the Prime Minister's Citizen Assistance and Relief in Emergency Situations Fund (PM CARES) within the category of "State" under Article 12 of the Constitution of India. .Appearing for the petitioner, Senior Advocate Shyam Divan argued that the PM CARES Fund satisfies various criteria to be viewed as part of "State". ."Can anyone argue that this is not State?...We are not able to find any factor to say that this (PM CARES) is not State. Except self-certification, everything points to it being State," Divan contended today..Alternatively, if the Fund is not held to be "State", it must stop projecting itself as if it is governmental through the use of the State emblem, use of "Prime Minister" in its name, etc, he added. .Divan will continue his arguments before a Bench of Chief Justice DN Patel and Justice Jyoti Singh on Monday at 2:15 pm. .Highlights of the arguments made today by Divan include:.1. Government cannot create a structure exempt from the Constitution.Constitutional functionaries cannot create instruments to exclude the Constitution's application, Divan argued. Constitutional functionaries are public trustees and cannot create a "cozy private enclave" beyond Constitutional scrutiny, he said. "Parties cannot contract out of the Constitution of India", he added..Insofar as the PM CARES Fund is concerned, he pointed out that there is only a declaration by the Fund itself that it does not form part of "State." Divan argued that while there are many devices that could be resorted to to exclude an entity from the purview of "State" and, thereby, exclude judicial review, courts have held that "you cannot have such self-declarations to exempt judicial review.".Recitals and statements that members of the Fund's Trust comprise government functionaries only for administrative convenience and that this does not mean the Fund is "government" will not help, Divan contended..2. On features indicating that PM CARES Fund is part of "State".If it is projected to the world at large that the PM CARES Fund is governmental in nature, then it is a "State," Divan contended. .To buttress his stance that the Fund has been projected as if it is part of the Government of India, he added:The members of the Fund's Trust comprise governmental functionaries who are ex officio members and such members are in the majority. This indicates that the government has deep and pervasive control over the Fund; The Prime Minister of India is the settler of the Trust and its ex officio Chairman. This is enough for an ordinary person to believe that it is a government fund; The purpose for which the Fund is created is also in the nature of a public purpose and closely linked to governmental functions. In this regard, it was also recalled that the PM CARES Fund had given ₹1 crore to states and union territories for the welfare of migrant workers amid the COVID-19 pandemic, which is in the nature of a government function; The emblem of India is used; The domain gov.in is used; The copyrights of the Fund belong to the Prime Minister's Office (PMO), as per the Fund's website; The official address of the PM CARES Fund is the PMO's. The facilities used by the PM CARES Fund are financed by tax payer money. The Fund enjoys benefits and exemptions reserved for the "State"; Officials from the PMO give secretarial support and assistance to the fund on a pro bono basis; Donations to PM CARES Fund are exempted from tax. Further, donations to the Fund also come within the purview of Corporate Social Responsibility (CSR) expenditure, which indicates that it is a fund of the Central government. These exemptions were announced in a release issued by the Press Information Bureau (PIB) on March 28, 2020..In view of this, Divan contended that the tests laid down in the Ajay Hasia ruling of the Supreme Court for the determination of what constitutes an instrumentality of the government have been satisfied. .He added that if PM CARES is a "State", aspects such as the appointment of officers, the delegation of functions and the manner in which its accounts are audited, would all be applicable, as it is with government entities and not as if it is a private trust. .3. High government functionaries have treated PM CARES as part of "government".Divan recalled that on March 29, 2020, the Vice President of India had issued a statement urging for contributions from Rajya Sabha members to be made to the PM CARES Fund, which he referred to as a fund set up by the Government of India."It is his impression. He is obviously making an accurate statement. This was never contradicted by the PM CARES...He tells Rajya Sabha that government has set up a fund under the PM CARES fund, that 'I have contributed one month's salary, I request members also to contribute one month's salary.' This was the Vice President," Divan argued. .Similar appeals were issued from the Union Ministries of Labour, Defence, Human Resources and the Cabinet Secretary, all of which referred to the Fund as being set up by the government, Divan contended. "The projection is clear. It brooks no ambiguity that this is a Government of India setup, so please contribute...This is perceived as part of government efforts...No one says this is a wrong thing, but these communications show that this has been set up by the Central government," he pointed out. Divan added that these communications have not been contested by anyone. .4. Would set a bad precedent if PM CARES is not deemed "State".Divan argued that creating structures that are immune from scrutiny becomes an extraordinarily unhealthy precedent. In this regard, reference was also made to the controversial Indira Gandhi Pratibha Pratishthan trust."The Constitution requires transparency...we are not saying there is quid pro quo like in Indira Gandhi Pratibha Pratishthan...We are not going so far because the structure itself is faulty," he argued..In this regard, Divan also raised concern that the Fund does not disclose details of contributions made by donors who are, therefore, completely free from scrutiny. .Among other prayers, the petitioner has pressed for directions so that details of all donors who contribute amounts exceeding ₹1 lakh (or such amount seen fit by the Court) are disclosed on the website of the Fund. .5. PM CARES cannot project itself as if it is "government" if Court rules that it is not "State".If the Court comes to the conclusion that PM CARES is not "State", the petitioner's alternative prayer is that the Fund cannot project that it is an initiative of the "Government of India," Divan submitted further. .This means that the Fund should then be restrained from using the term "Prime Minister", or using the State emblem, the tag "gov.in", or the PMO as its official address. Further secretarial support or support from offices of the government cannot be extended in such a case, Divan added. .Whether PM Cares Fund is "State" under Article 12 of the Constitution [Live Updates from Delhi High Court]