The event, being organised over 1,000 acres, will damage the fragile ecosystem of the Yamuna, allege environmentalists.
The Union Culture Ministry's Rs 2.25 crore grant to Sri Sri Ravi Shankar's grand festival on the banks of the river Yamuna provoked questions from the green court today.
The National Green Tribunal asked to see the ministry's letter granting the money to Art of Living for the "World Culture Festival".
Then it proceeded to say that this money would be seized if Art of Living failed to pay Rs 5 crore as environmental compensation for the damage to the Yamuna floodplains.
The ministry is reportedly still to pay Rs 1.68 crore to Sri Sri's foundation.
NDTV has accessed details which show that in December, the ministry headed by Mahesh Sharma sanctioned Rs. 2.25 crore for Sri Sri's event.
The government funding was allotted to the Vyakti Vikas Kendra Trust in Bengaluru, run by Sri Sri Ravi Shankar, as part of the Culture Ministry's programme of Financial Assistance to Cultural Organisations.
The festival's posters show the Culture Ministry as one of a number of supporting organisations. The event, being organised over 1,000 acres, will damage the fragile ecosystem of the Yamuna, allege environmentalists who have taken the Art of Living Foundation to court.
Sanjeev Bhargava of SEHER, which organises cultural events, said a grant worth more than Rs. 2 crore from the government for an individual event is unheard of. "Normally, the Ministry at best would agree to give Rs. 15-20 lakh," he said.
Culture Minister Mahesh Sharma said the money was given to the Art of Living Foundation as part of "routine" grant to organisations promoting art and culture.
"Culture Ministry has not given any money for organising this function... Even the Art of Living Foundation never asked for money from the government for organising this particular event," Mr Sharma told the Press Trust of India.
A seven-acre stage, telecom towers and more than 600 portable toilets have been set up for the event.
The organisers don't seem in need of funding. According to its submissions to the Ministry, the trust that received the government grant declared expenses of more than Rs. 100 crore in 2012 and over 90 crores the next year.