THE HON’BLE SRI JUSTICE P.S.NARAYANA WRIT PETITION No.21721 of 2005 DATED: 10-10-2007. Between: Zilla Vikalangula Sangam rep. by its President T. Saidamma. .. PETITIONER And The Government of India, rep. by its Secretary, Ministry of Social Justice and Empowerment, Sastri Bhavan, New Delhi and others. .. RESPONDENTS THE HON’BLE SRI JUSTICE P.S.NARAYANA WRIT PETITION No.21721 of 2005 ORDER: This writ petition is filed by Zilla Vikalangula Sangham, represented by its President T. Saidamma, seeking a writ of Mandamus declaring the action of the 1st respondent in putting the petitioner organization on blacklist, vide proceedings File No.12/1(4)/2000-2001-SD (NGO), dated 20.04.2001, and continuing the same on blacklist despite the enquiry report submitted by the 2nd and 3rd respondents mentioning that the activities of the petitioner organization for Street Children are satisfactory and the same is eligible for receiving grant-in-aid, vide their proceedings Lr.No.3953/J3/A2/2002-1, dated 27.05.2002 and Lr.No.P3/112/2002, dated 06.06.2002, respectively, as illegal, arbitrary and violative of constitutional provisions. 2. Sri Seetharam Chaparla, the learned counsel, representing Sri K. Gani Reddy, the learned counsel for the writ petitioner had taken this Court through the contents of affidavit filed in support of the writ petition, the respective counter-affidavits filed by the 1st respondent and the respondents 2 and 3 and also the contents of the reply affidavit and would comment that in the light of the facts and circumstances, the impugned order cannot be sustained. The learned counsel also would contend that even otherwise the so-called allegations in relation to the credentials of the petitioner organization are only based upon assumptions and presumptions and absolutely there is no acceptable or valid material in relation thereto. The learned counsel also would maintain that the so-called non-government Organization Nodal agency has no right to inspect the petitioner organization of Street Children Project for the simple reason that the said Nodal Agency is also running the similar project of street children and the same is being controlled by the 1st respondent. The learned counsel also would maintain that the Two-Man Committee categorically stated that the activities of the Street Children Project of the petitioner organization are found satisfactory and the said organization is entitled to the grant-in-aid. The learned counsel also would maintain that, having directed the State Government authorities to conduct enquiry into the matter and having received the enquiry report, absolutely there is no justification on the part of the 1st respondent in delaying the sanction of grant-in-aid and also continuing the petitioner on the blacklist. The learned counsel also would maintain that the petitioner society is not involved in any criminal case and the so-called criminal case had been filed against the former President and by that it cannot be said that the petitioner society should be continued to be kept under the blacklist. The learned counsel also would further maintain that the District Collector himself sanctioned the loan and the concerned authorities, after taking into consideration the enquiry report, had released the grant-in-aid and, in the light of the same, it can be taken that the petitioner society had been deleted from the blacklist. The learned counsel also would further maintain that the concerned authorities, having directed the petitioner to withdraw the writ petition and having promised to release the grant-in-aid and having released the grant-in-aid, are now estopped from contending otherwise taking a stand that the petitioner is under the blacklist. The learned counsel also placed strong reliance on a decision in Mohinder Singh Gill and another v. The Chief Election Commissioner, New Delhi and others[1]. 3. Per contra, the learned Assistant Solicitor General, representing the 1st respondent, had taken this Court through the counter-affidavit filed by the 1st respondent and would maintain that in the light of the specific stand taken by the 1st respondent, the writ petition is liable to be dismissed. The learned Assistant Solicitor General also would maintain that the petitioner organization is continuing under the blacklist and Anti Corruption Bureau of Government of A.P., having detected that the petitioner organization had falsified record and misused the Government funds, had filed F.I.R. in the Special Court of Anti Corruption Bureau, Vijayawada. It is also stated that the Writ Petition No.23845 of 2002 filed by the petitioner organization against the said F.I.R.No.15/ACB-VJA/2000 on the file of the Special Court of Anti Corruption Bureau, Vijayawada, is pending disposal. As per Rule 149 (1) of the General Financial Rules, sanctioning authorities should ensure that no grants are sanctioned where there is a reasonable suspicion or suggestion of corrupt practices unless the bodies concerned are cleared of the allegations. The learned Assistant Solicitor General also would maintain that the Anti Corruption Bureau has registered a criminal case, vide No.15/ACB- VJA/2000, under Section 13 (1) (e) and (d) of Prevention of Corruption Act, 1988 and under Sections 409, 420 and 477 (A) of the Indian Penal Code against the Ex-President of the petitioner organization for acquiring disproportionate assets to his known source of income by cheating, by breach of trust and by diverting Government funds under various welfare schemes for destitute disabled and handicapped children given by State and Central Government and has amassed wealth by way of cash and immovable properties. The learned Assistant Solicitor General also would maintain that the 1st respondent Ministry cannot ignore the earlier detailed correspondence of State Government regarding the organization being involved in the Anti Corruption Bureau case and it cannot also ignore the fact that the State Government had specifically withdrawn the earlier recommendation of grant- in-aid, vide letters dated 28.04.2003 and 28.05.2003, in view of the pending Anti Corruption Bureau case against the organization. The learned Assistant Solicitor General also would maintain that the petitioner organization, according to the inspection report, had offered bribe and such a claim would amount to an attempt to manipulate and use of the dubious methods to force Government of India to de-blacklist the organization and sanction grant-in-aid to the organization. Hence, in the light of the same, the learned Assistant Solicitor General would contend that the writ petition, being devoid of merit, is liable to be dismissed. 4. The learned Government Pleader for Women and Child Welfare had taken this Court through the contents of the counter-affidavit filed by respondents 2 and 3 and would maintain that in the light of the nature of allegations being very serious, the writ petition, being devoid of merit, is liable to be dismissed. 5. Heard the counsel on record and perused the material available on record. 6. It is averred in the affidavit filed in support of the writ petition that the petitioner is a society established and incorporated under the Provisions of the Societies Registration Act, 1860, vide Registration No.79/1980, with the objective of encouragement to the handicapped for getting education, to work for unity and to create equality in the society for better development and strong formation of the Nation. The aims and objectives of the petitioner society include establishment of educational institutions for imparting education to the physically handicapped, deaf and dumb, adult education, education for the child labour etc. The petitioner is also providing shelter to street children. Thus, the petitioner is an institution, which is catering to the needs of the handicapped persons by way of establishing organizations like Street Children Project, School for the Deaf and Residential School-cum- Vocational Training Centre for the disabled. It is also further stated that the Organization of Street Children Project has been in receipt of financial assistance from the Ministry of Social Justice and Empowerment, Government of India. It is further stated that the Nodal Agency of this Ministry has inspected the Projects and alleged to have raised some doubts about the credentials of the organization and observed that it was not running the Centre as envisaged in the scheme. Basing upon the said report, the 1st respondent has issued a show cause notice on 11-10-2000 calling upon the explanation from the organization as to why the organization should not be blacklisted. Thereupon, the petitioner submitted detailed explanation, dated 20.10.2003, stating that the allegations contended in the notice, dated 11.10.2000, are false and incorrect. The petitioner has explained each of the allegations stating that the petitioner has been conducting its affairs as per the guidelines of the 1st respondent. Despite the satisfactory explanation of the petitioner, the 1st respondent, by its letter, dated 20.04.2001, vide File No.12/1(4)/2000-2001-SD (NGO), decided to put the organization in the blacklist. It is also further stated that the Nodal Agency, which is said to have inspected the petitioner’s Street Children Project, is not at all competent authority to inspect the same, inasmuch as the so-called Nodal Agency is nothing but a Non-Governmental Organization. It is unfair on part of the respondents to act upon mere doubts without there being any valid material, so as to warrant the blacklisting of the organization. It is also stated that in the instant case, the 1st respondent, without applying his mind to the implications of blacklisting of organization, which is looking after Street Children who are entirely depending upon the grant-in-aid sanctioned by the concerned authorities, blacklisted the organization. Questioning the same, the petitioner society filed W.P.No.9578 of 2001 before the Hon’ble High Curt and the same was admitted. At that juncture, the 1st respondent asked the 2nd respondent to inspect and submit the report with regard to both the handicapped and street children projects of the organization in order to decide the release of the grants for the above stated projects. In pursuance of the above directions, the 2nd respondent, by its Memo No.8450/DW A2/2000- 2001, dated 08.04.2002, directed the 3rd respondent as well as the Commissioner, Disabled Welfare, to get the inspection conducted and submit report within a fortnight. Accordingly, the 3rd respondent herein, vide its Memo No.P3/112/2002, dated 12.04.2002, appointed Two-Man Committee to enquire into the truthfulness of the so-called allegations which constituted basis for blacklisting the organization. It is also further stated that in pursuance of the directions issued by the 3rd respondent, the Two-Man Committee inspected the organization and found that the entire activities of the organization are satisfactory and submitted the report to the 3rd respondent. The 3rd respondent, having found the entire enquiry report satisfactory, submitted the same to the 2nd respondent and recommended, vide proceedings Lr.No.P3/112/2002, dated 06.05.2002, for sanction of grant- in-aid to the Organization for the years 2000-2001 and 2001-2002. Basing on the enquiry report and recommendation given by the 3rd respondent, the 2nd respondent, having found satisfactory about the inspection and enquiry report, has forwarded the same to the 1st respondent and recommended for sanction of grant-in-aid of Rs.13,15,000/- and to continue the same for each year. It is also further stated that when the petitioner society pursuing for the above said grants, the 1st respondent informed orally that the society has to withdraw the Writ Petition No.9578 of 2001 filed before this Court before receipt of the grants, and believing the version of the 1st respondent, the petitioner society has withdrawn the said writ petition. But, unfortunately, the 1st respondent, having promised as aforesaid, has not taken any action till today and no amounts of grant-in-aid were sanctioned with regard to Street Children Project, which is nothing but illegal and arbitrary, and the petitioner society, which is in legitimate expectation of grant-in-aid, is facing lot of problems and hardship on account of adamant and indifferent attitude of the 1st respondent towards the Street Children. It is also averred that, having sanctioned grant-in-aid for the year 2002-2003 of an amount of Rs.26,19,000/- for running Residential School-cum-Vocational Training Centre for Disabled, there is no justification on the part of the 1st respondent to deny the same for the year 2003-2004 without there being any valid reason whatsoever. It is further averred that the 2nd respondent has already, vide its letter No.2975/DW.A2/2004, dated 05.06.2004, recommended to the 1st respondent for sanction of an amount of Rs.38,40,694/- for running the Residential School-cum-Vocational Training Centre. Despite of it, the 1st respondent till today has not sanctioned any grants for the organization, causing great hardship to the petitioner society in general and the disabled and street children in particular, who are depending upon the society for bread and butter. It is also further stated that the action of the 1st respondent in not sanctioning recommended grants and still continuing the petitioner organization on blacklist is illegal, arbitrary and violative of constitutional provisions. Questioning the same, the petitioner filed W.P.No.3366 of 2005 before this Court and this Court was pleased to dispose of the same by directing the concerned authorities to consider the proposals sent by the 2nd respondent therein for the purpose of releasing grant-in-aid to the petitioner society. Further, it is averred that against the aforesaid backdrop of the facts and circumstances of the case, the 1st respondent, vide his proceedings dated 13.09.2005 in File No.6-7/2004-C, instead of considering the recommendations for sanction of grant-in-aid of Rs.13,50,000/-, by taking into enquiry report into consideration and having given consent before this Court to consider the recommendations for release of grant-in-aid, intentionally avoided the same on the ground that the petitioner society was involved in the anti corruption case and, therefore, it is necessary to know the stage of the case before releasing of the grant-in-aid. It is further stated that it is unfortunate the concerned authorities are coming forward with new grounds, which are not all relevant and concerned with the petitioner society, in order to deny the grant-in-aid to the petitioner. There is no case against the petitioner society much less any anti corruption case and that it is unfair and there is no justification on the part of the concerned authorities in attributing malafides and creating suspicious circumstances around the petitioner society, which is genuinely rendering service to the disabled and street children, and the same is also reflecting in the enquiry report. It is also further stated that the respondents, on the one hand stating that the petitioner society is blacklisted and, therefore, funds cannot be released, on the other hand, are stating that the petitioner society involved in Anti Corruption Case. The basis on which the petitioner society was blacklisted is totally different and has nothing to do with anti corruption case, which is foisted against the former President at the instance of his rival N.G.O., and that either the petitioner society or its President has never been involved in the so-called criminal case No.15/ACB/VJA/2000, dated 29.09.2000. It is also further averred that the so-called criminal case against the former President of the petitioner society, which is filed at the instance of his rival N.G.O. one Smt. Pamavathi, and either the said criminal case or the former President has nothing to do with the petitioner society. Therefore, the concerned authorities cannot be permitted to say that the petitioner society involved in criminal case. Further, the statement of the 1st respondent is full of contradictions and at variance with material on record inasmuch as on the one hand it categorically stated that basing on the report of the N.G.Os., the petitioner society was blacklisted and, immediately thereafter the 1st respondent itself has constituted enquiry committee to enquire into the activities of the society and invited report. Instead of taking into consideration the above said report, while releasing grant-in-aid by way of deleting the petitioner society from the blacklist, the 1st respondent again dragging the petitioner society into Criminal Case, so as to deprive the society from getting the grant-in-aid and thereby depriving of the benefit, which are flowing out of the schemes, to the disabled persons and street children. Further, it is also stated that the enquiry committee, which is constituted by the 1st respondent, has gone into the activities of the petitioner society and submitted detailed report saying that the petitioner society is maintaining properly all accounts and looking after the street children by providing al necessary amenities and recommended necessary grants forthwith. Further, the District Collector has been sanctioning loan of Rs.3,00,000/- per month towards maintenance of the petitioner society, under the reimbursement basis, after receipt of grant-in-aid from Government of India and constituted a Committee to look after the activities of the society. The enquiry report and the fact that the District Collector himself sanctioning loan to the petitioner society categorically prove that the credentials of the society are above suspicion and genuine and that the petitioner society is in urgent need of grant-in-aid so as to provide decent and sufficient care to the disabled persons and street children. It is also further averred that as a matter of fact, since the petitioner society was sanctioned grant-in-aid subsequent to blacklisting of the society, by taking into the enquiry report, it can be safely said that the petitioner society is deemed to have been deleted from the blacklist. Even otherwise, it is at the instance of the 1st respondent’s assurance that the earlier writ petitions were withdrawn and after withdrawn only, the aforesaid grants were released. While that being so, it is unfair and unjust on the part of the concerned authorities to again reiterate that the petitioner society is still in the blacklist. 7. A counter-affidavit is filed by the 1st respondent and the same is sworn by the Under Secretary (CW-II), Ministry of Women and Child Development, Government of India. It is averred in paragraph 3 of the said counter-affidavit that the contention of the petitioner in paragraph 2 of the affidavit filed in support of the writ petition stating that an enquiry commission was appointed by the 1st respondent is denied. It is also stated that the 1st respondent had requested the 2nd respondent, vide letter dated 22.03.2002, to get the projects of both handicapped and street children run by the organization inspected. Accordingly, a Memorandum, dated 08.04.2002, was addressed by the Principal Secretary, Woman Development, Child Welfare and Disabled Welfare (DW) Department, Government of Andhra Pradesh, to the Commissioner, Disabled Welfare, Hyderabad, and Commissioner, Juvenile Welfare and Correctional Services, requesting to get the projects of both handicapped and street children respectively inspected and send a detailed report as desired by the Government of India within a fortnight. It is also stated that the facts of the case along with the reasons for refusing grant-in- aid to the petitioner organization had been given in the order, dated 13.09.2005, issued by the respondent Ministry, and the contents of the said order may be relevant for the present purpose and the same are hereunder: By Speed Post No.6-7/2004-CW Government of India Ministry of Social Justice and Empowerment Shastri Bhawan, New Delhi-110001 Dated the September 13, 2005 To The President Zilla Viklangula Sangam, Vinukonda-522 647, Guntur District (Andhra Pradesh). Subject:- Request for sanction of grant-in-aid for running street children project for the years 2000-2001 and 2001-2002 – Writ Petition No.3386 of 2005 in the Hon’ble High Court of Judicature of Andhra Pradesh at Hyderabad. …… Sir, The Zilla Vikalangula Sangam, Guntur (Andhra Pradesh), a non- Governmental organization, filed a Writ Petition No.3386 of 2005 in the Hon’ble High Court of Judicature of Andhra Pradesh at Hyderabad praying for:- (a) setting aside the Ministry of Social Justice and Empowerment letter No.12/1(4)/2000-01-SD(NGO) dated 20.4.2001 blacklisting the petitioner organization; and (b) directing the Ministry to sanction grant-in-aid for the years 2000-2001 and 2001-2002 as recommended by the Government of Andhra Pradesh vide their letter No.3953/J-3/A2/2002-1 dated 27.5.2002 pending disposal of the writ petition.” The Hon’ble High Court passed the Order dated 16.6.2005 which reads as under:- “…… It is no more in dispute that the second respondent recommended the proposal to the first respondent under letter No.3953/J3/A2/2002- 1 dated 27.05.2002. The text of the letter reads as follows:- ‘I forward herewith the project proposal of Zilla Vikalangula Sangam Vinukonda along with inspection report of Superintendent, Government observation Home for Boys, Vijayawada and District Probation Officer, Grade-I, Guntur for sanction of Grant-in-aid of Rs.13,50,000/- (Rupees thirteen lakhs fifteen thousand only) after deducting 10% organization contribution to other with information in part-II proforma and recommend the same for consideration under the scheme of welfare of street children for the each year 2000-2001 and 2001-2002’. It seems the first respondent has not taken any action on the recommendation made by the second respondent. In such a situation, the writ petition can be disposed of giving a direction to the first respondent to consider the proposal sent by the second respondent with regard to the sanction of Grant-in-aid to the petitioner-organisation for the years 2000-2001 and 2001-2002. The first respondent has to pass appropriate orders on the proposal sent by the second respondent within three months from the date of receipt of a copy of this order and communicate the same to the petitioner-organisation” In this petition, the Government of India, Ministry of Social Justice and Empowerment, New Delhi, the Government of Andhra Pradesh, Ministry of Women and Child Development, Disabled Welfare Secretariat, Hyderabad and the Commissioner Zonal Welfare Correctional Services and Welfare of Street Children, Hyderabad are the first, second and third respondents respectively. 2. The facts of the case are given below:- (i) The Ministry of Social Justice and Empowerment sanctioned the following grants-in-aid to the Zilla Viklangula Sangam under the “Scheme of Integrated Programme for Street Children” for running the project titled ‘Centre for Street Children’. Year Amount 1998-1999 Rs.4,31,340.00 1999-2000 Rs.13,50,000.00 (for 500 children) Before releasing the grant for the year 2000-01, an inspection was carried out to ascertain the achievements and performance during the previous years. The inspection was carried out on 2.7.2000 by a representative of Childline India Foundation which ahs been authorized by the Ministry as the Nodal Agency to conduct the inspections and evaluate the projects for street children. The inspection report was received from CIF in the first week of October, 2000. The report contained unfavourable remarks including after 5th standard and presence of only 50 children as against the sanctioned strength of 500 children. The findings of the inspection report were communicated to the Organisation in the form of a Show Cause Notice vide the Ministry’s letter No.12/1(4)/2000-2001-SD dated 11.10.2000. The explanation given by the Organisation was not found to be satisfactory. It was, therefore, decided to suspend further grant-in-aid to the petitioner-organisation and the decision was communicated to it with an endorsement to the Government of Andhra Pradesh vide Ministry’s letter No.22-1(4)/2000-01-SD dated 30.1.2001. (ii) A number of organizations including the petitioner-organisation which were not running the projects in consonance with the “Scheme of Integrated Programme for Street Children” were simultaneously blacklisted. This position was communicated to the petitioner-organisation vide the Ministry’s letter No.22- 1(4)/2000-01-SD dated 20.4.2001. The petitioner-organisation filed a Writ Petition No.9578/2001 before the Hon’ble High Court praying for withdrawal of blacklist order dated 20.4.2001 blacklisting it. Subsequently, the petitioner-organisation sought the permission of the Hon’ble Court to withdraw the petition and the case was dismissed as withdrawn on 2.8.2002. (iii) The petitioner-organisation was also given grant-in-aid by this Ministry for Residential School and Vocational Training Centre for Orthopaedically Handicapped Persons. On 18.10.2000, this Ministry received a communication from the Anti-Corruption Bureau of the Government of Andhra Pradesh seeking certain documents/details of financial assistance released to the organization in connection with a criminal case No.15/ACB/VJA/2000 dated 29.9.2000 filed against the petitioner-organisation. The case relates to the breach of trust, diversion of Government funds through cheating and mis- appropriation, etc. (iv) In February 2002, the President of the Organisation met the then Secretary (SJ&E) and requested for release of grant-in-aid to the organization. The State Government was requested to get the project of the NGO inspected vide this Ministry’s letter dated 22.3.2002. The District Magistrate, Guntur who was asked by the State Government to conduct the inspection requested the State Government to reject the application of the organization in view of the fact that Anti Corruption Bureau has already filed a case. The Government of Andhra Pradesh informed this Ministry on 28.5.2003 that the Anti Corruption Bureau in its investigation found that the organization falsified the records and grabbed the Union Government Funds, acquired assets, dis-proportionate to non-sources of income of the