The Kerala High Court holds that that it was essential for the authority to specify the reason for denial in every order, as it was an “indispensable part of a sound judicial system.”
| Photo Credit: R K Nithin
The Kerala High Court on Tuesday (August 11, 2026) quashed an order issued by the Centre refusing to renew the Foreign Contribution Regulation Act (FCRA) certificates of two NGOs on the ground that they had allegedly used the foreign donations to fund the protests against the Vizhinjam seaport project.
The authorities had denied the certificates based on an intelligence report by a Central security agency, allegedly without furnishing any reasons.
The court has directed the competent authorities to review and pass orders afresh according to its observations within three months for the petitioners, Save A Family Plan and Kerala Social Service Forum. It held that it was essential for the authority to specify the reason for denial in every order, as it was an “indispensable part of a sound judicial system.”
Centre’s stance
The Central government had argued that the right to receive foreign contributions was not fundamental and that the petitioners were bound to verify how their funds were being used. It contended that when national security was at stake and there was a possibility of foreign funds being used for undesirable purposes, the authorities were entitled to exercise their discretion to refuse renewal.
‘Too far-fetched’
Justice Bechu Kurian Thomas observed that the connection attempted to be created with funding the protesters and the NGOs was “too far-fetched.” It was also noted that the intelligence report did not refer to any forceful demonstration, use of arms or violence.
The court also held that a peaceful protest by the aggrieved persons against such a project could not be viewed as an undesirable purpose, and even if some financial support was provided, it would not be violative of the FCRA regulations.
The court examined the Central security agency’s report and found that it could not identify any sensitive material that needed to be withheld from the NGOs. It held that such protests were “common” whenever a new project was announced and could not see how it was an issue of national security.
Both NGOs were denied renewal, citing violations of the FCRA Act, including using foreign funds for personal gain and accepting funds to prejudice social harmony. Save A Family Plan had also sought permission to utilise the ₹16 crore received while the licence was in force, which was allowed by the court.
Published – August 12, 2026 03:45 pm IST
