Bhagavad Gita Is Not A Religious Book, It Is Moral Science Rooted In Bharatiya Civilization: Madras High Court

“Once Offence Is Compounded, Slate Is Wiped Clean”, Madras High Court quashed the Union Government’s rejection of the Trust’s application for registration under the Foreign Contribution (Regulation) Act, 2010. Justice G.R. Swaminathan held that once a technical offence under the FCRA has been lawfully compounded, it cannot be treated as a disqualifying factor under Section 12(4) of the Act. The Court also firmly rejected the label of the petitioner as a “religious organization,” holding that dissemination of the Bhagavad Gita and Vedanta does not necessarily amount to religious activity under the FCRA.

Calling the order of rejection “vague, disproportionate, and violative of natural justice,” the Court set it aside and remanded the matter for fresh consideration within three months.

A Charitable Trust Accused of Technical FCRA Violation and Religious Activities

The petitioner, Arsha Vidya Parampara Trust, a public charitable trust established in 2017 by disciples of Swami Dayananda Saraswati, engages in teaching Vedanta, Sanskrit, Hatha Yoga, and preserving ancient manuscripts. It is registered under Section 12A of the Income Tax Act, which grants it recognition as a charitable organization.

In 2021, the Trust applied for registration under Section 11 of the FCRA to receive foreign contributions. After an inexplicable delay of nearly three years, queries were raised in 2024 regarding a donation of ₹9 lakh received from one of its trustees, a U.S.-based Overseas Citizen of India. The Trust admitted the oversight and, upon being given the option, compounded the offence in August 2025 by paying ₹3,70,500 as compounding fees. However, in September 2025, the Ministry of Home Affairs (MHA) rejected the Trust’s application on two grounds: (1) receipt of foreign contribution without prior approval, and (2) the organization "appearing to be religious."

 “Compounded Offence Cannot Be Used As Adverse Material Under Section 12(4)”

Justice G.R. Swaminathan categorically ruled that the first ground for rejection—receipt of funds without prior approval—was unjustified, as the contravention had already been lawfully compounded under Section 41 of the FCRA.

“When once the offence has been compounded, the contravention can never be an adverse ground which can be cited against the applicant,” the Court observed. Quoting from the statute, the judge held: “From this, one can safely come to the conclusion that once an offence has been compounded, the slate is wiped clean.”

The Court added that a technical lapse such as this, which had been acknowledged, remedied, and penalized, cannot be used to permanently disqualify an applicant, especially when the MHA itself failed to indicate during the compounding process that such disqualification would follow.

“In this background… even while the application for registration is under consideration, the authority gave an option of compounding the offence... The petitioner had acted with all bonafides,” the Court remarked.

Moreover, the second allegation—about transfer of foreign funds to another organisation—was found to be factually vague and unsupported, as no such issue was previously raised in notices or queries. The Court termed this a breach of natural justice, stating: “The petitioner was never put on notice in this regard... The details are blissfully absent.”

Bhagavad Gita, Vedanta, Yoga Not Exclusive To Religion: Cultural and Moral Teachings, Not Sectarian Preaching

The MHA had also rejected the registration on the basis that the Trust appeared to be religious due to its engagement in Bhagavad Gita and Vedantic teachings. The Court rejected this reasoning as untenable and misaligned with Section 11(1) of the FCRA, which permits religious organizations to receive foreign contributions, subject to registration.

Justice Swaminathan held: “Bhagavad Gita is not a religious book. It is rather a moral science... It is a part of Bharatiya civilization.” Citing Shyamal Renjan Mukherjee v. Nirmal Ranjan Mukherjee, the Court emphasized that the Gita speaks to internal and eternal truths and was foundational to India’s freedom struggle.

Further rejecting the religious tag on Yoga and Vedanta, the Court quoted from Indian and foreign judicial precedents: “Spirituality and religion are not interchangeable terms... Yoga is something universal, not to be viewed through the prism of religion.”

The Court referred to the petitioner’s 12A registration under the Income Tax Act as a valid and binding acknowledgment of its charitable status. Since the FCRA does not override other laws (Section 52), the Court reasoned that: “When according to the Income Tax Department, the petitioner is a charitable organization, it cannot cease to be one under FCRA regime.”

Writ Petition Maintainable Despite Appeal Mechanism: Violation of Natural Justice and Proportionality

While the ASG for the Union of India objected to the maintainability of the writ petition under Article 226, citing the appeal provision under Section 31(2) of the FCRA, the Court brushed aside this objection by invoking the doctrine of exception in cases involving breach of natural justice.

Citing the Supreme Court’s 2025 decision in Rikhab Chand Jain v. UOI, the Court held: “This ruling answers the objection raised... The writ petition cannot be said to be not maintainable. However, the High Court is expected to lay down a higher threshold.”

In this case, both fundamental violations—lack of fair notice on new grounds and disproportional reliance on a compounded offence—clearly met that higher threshold.

Fresh Decision Directed, Fair Procedure Mandated

In conclusion, the Madras High Court set aside the impugned order rejecting the FCRA registration application of Arsha Vidya Parampara Trust and remitted the matter to the MHA for reconsideration.

The Court directed the MHA to issue a fresh notice on the issue of fund transfer (if any), but only if supported by specific and relevant materials, and to pass a reasoned order after considering all observations made in the judgment. This process is to be completed within three months.

By reaffirming that compounding of offences under FCRA restores eligibility and redefining the lens through which cultural-philosophical education is viewed, this ruling serves as a vital precedent in FCRA jurisprudence and the treatment of charitable organizations with Indic roots.

Date of Decision: 19 December 2025