The Supreme Court’s Constitution Bench comprising five judges led by CJI D Y Chandrachud will hear a batch of pleas challenging the legal validity of electoral bonds scheme that facilitates anonymous funding to political parties. The pleas demand transparency and the right of citizens to know the details concerning the donations and the donors who fund the political parties. However, a day before the hearing, Attorney General of India R Venkataramani on behalf of the Central government has stated that citizens do not have the right to information regarding funding of a political party. The Court will give its judgement anyway, but it has reignited the discussions over political parties and unlimited funding they receive from anonymous sources.
Be it toppling of Thackeray government by Fadnavis-led government in Maharashtra or defection of Congress MLAs to BJP in Goa, even school going students will be able to tell that such operations cannot be carried out without spending a ton of money. The discourse around political parties and their funding has been going on since the last six years. Former union finance minister Arun Jaitley introduced the electoral bond scheme in 2017, while presenting the budget. As per the government, the scheme would have curbed the inflow of cash and the black money that comes with it. The scheme was notified on January 2, 2018. However, the scheme drew criticism from the Opposition who said that the system lacked transparency. Later, Association for Democratic Reforms (ADR) and Communist Party of India (CPI) filed a petition against the implementation of the scheme and demanded its suspension which was refuted by the court.
Essentially, electoral bonds allow Indian citizens to purchase bonds in denominations ranging from Rs 1000 to Rs 1 crore enabling anonymous donations to political parties. The bonds of 1000, 10,000, one lakh and one crore can be bought from authorised SBI branches. Of course, one simply cannot take Rs 1 crore cash to the bank and buy the bond. The transactions for the respective bond cannot be done by cash and has to transfer money from his bank account to State Bank of India. Now, one might wonder that if the transaction will be carried out from bank to bank, then there is nothing to hide. The petitioners however have highlighted the exact loophole. Although the bonds are purchased by transferring the money from donor’s account, the scheme does not allow disclosure of the name of the donor or the party who has received the respective donation. This detail does not become public and the petitioners have argued that it is against the fundamental rights of the citizens.
In fact as per Prashant Bhushan, advocate for one of the petitioners, the government by amending The Finance Act, 2017 has removed the limit on the amount of donations made by companies to the political parties. These donations can be made anonymously as well. The total amount of donations made to the political parties can be known but the companies are not bound to make the figure of the amount donated to each party public. The Election Commission too, have objected to the electoral bond scheme. EC while writing to the Ministry of Law and Justice regarding the amendment made in 2017 had stated that not announcing the amount received through donations would not be conducive to transparency. As stated by EC itself, many political parties in 2017 did not give details by claiming that they received less than Rs 20,000 in donations through electoral bonds. Apart from this, the government through an amendment in 2016 has allowed foreign companies to donate to the Indian political parties if these companies have made significant investments in Indian companies. According to information received by Commodore Lokesh Batra (Retd) under RTI, electoral bonds worth Rs 11,700 crore were sold in 24 phases from March 2018 till December 2022. Nearly 90% of bonds were of Rs 1 crore each and petitioners claim that 75% of this amount goes to the BJP. As per the report by ADR, BJP stated its earnings at around Rs 553 crore in the year 2017-18 and the organisation claims that Rs 215 crore out of the total earnings came from electoral bonds. When the case was being heard in the Supreme Court on March 24, the court asked Adv Prashant Bhushan that the electoral bonds must be donated to other parties and not just the ruling party. Adv Bhushan argued that since only the ruling party is capable of giving the benefits, the enormous donations would be made to the ruling parties whether they are in power in States or at the Centre. The final hearing comes after all the aforementioned arguments. It is secondary whether the Court maintains the electoral bond scheme as per the Finance Bill or not but perhaps what is more important would be whether the citizens will get the right to know the details of the donations made to the parties.
