The Aryavarth Express
Agency (New Delhi): Congratulations to the Supreme Court bench led by the Chief Justice of India Dr. D Y Chandrachud for finally declaring the electoral bond scheme of the Narendra Modi government as ‘unconstitutional’, since the bonds are violative of the right to information under Article 19(1)(a) of the Constitution. The State Bank of India, the issuer of the bonds on behalf of the union government, has been asked to stop the issuance of further bonds and to submit the list of the bonds issued and the purchasers from the day of its interim order issued on April 12, 2019 to the Election Commission.ECI is tasked with publishing the SBI list on its website by March 13 this year.
It is not clear what will happen to the electoral bonds issued after April 12, 2019, the day Supreme Court issued the interim order. Legal observers expected that an interim stay would be issued on the sale of the electoral bonds, as this was a sensitive issue linked with the functioning of democracy on the basis of level playing field of the political parties. But this stay was not granted, and the scheme continued for nearly five years more as the hearings continued in the Supreme Court. The hearings concluded on November 2, 2023 and the bench reserved the verdict.
According to the judgment, “At a primary level, political contributions give a seat at the table to contributors, i.e., it enhances access to legislators. This access also translates to influence over policymaking. There is also a legitimate possibility that financial contributions to a political party would lead to quid pro quo arrangement because of the close nexus between money and politics. The electoral bond scheme and the impugned provisions to the extent that they infringe upon the right to information of the voter by anonymising contributions through electoral bonds are violative of Article 19(1)(a).”
The court held that the restrictive means test of the doctrine of proportionality is not satisfied and that there are other means other than electoral bonds to achieve the purpose of curbing black money, even assuming it to be a legitimate objective. The infringement to the right to information is not justified, the Court held. Acknowledging the right of informational privacy extends to financial contributions which is a facet of political affiliation, Chief Justice Chandrachud revealed that a double proportionality standard was applied to balance the conflicting rights to information and to informational privacy. The bench held the amendments to the Income Tax Act, the Representation of Peoples Act and the Companies Act as unconstitutional.
The judgment said Electoral Bonds which are within the validity period of 15 days but which have not been encashed by the political parties yet shall be returned by the political party to the purchaser. The issuing bank shall then refund the amount to the purchaser’s account. Thisis fine. This involves not a large amount as it concerns only the tranche issued in January this year. But the bonds issued after April 12, 2019 to the end of 2023 are huge in amount and most of the funds have been used by the BJP for the state assembly as also 2019Lok Sabha election, as well as for the current ongoing campaign. The Party which is already flush with funds from other sources, including overseas has been the beneficiary of a wrong decision taken by the Supreme Court on April 12, 2019 by refusing to give interim stay on the issue of the bonds.
The electoral bonds scheme was passed by Parliament in 2017and it took effect from 2018. Soon the petitions were filed in the Supreme Court challenging the legislation. At the heart of the petitions lie objections to the electoral bonds scheme, introduced through amendments in the Finance Act 2017. The petitioners, including the Association for Democratic Reforms (ADR), the Communist Party of India (Marxist), and Congress leader Jaya Thakur, argued that the anonymity associated with electoral bonds undermines transparency in political funding and encroaches upon voters’ right to information. They further contended that the scheme facilitates contributions through shell companies, raising concerns about accountability and integrity in electoral finance. The Supreme Court judgment of February 15 vindicated their stand.
Electoral bonds worth more than Rs 570 crores have been sold in the latest phase of the electoral bond sale that lasted from January 2 to January 11, 2024. This was the second batch of electoral bonds sold since the Supreme Court began hearings for the four petitions challenging the legality of the electoral bond scheme announced by the Narendra Modi government in 2018. So far, 30 tranches have been sold and the biggest beneficiary has been the BJP which is the ruling party.
Recent ADR report reveals that in 2022-23, the corporates donated Rs. 850 crore to the political parties in the country. Out of this amount, Rs. 719.8 crore went to the BJP and only Rs. 79.92 crore to the Congress. This means more than 80 per cent of the corporate donations went to the ruling party the BJP. This percentage is expected to go up in 2023-24 financial year as the Prime Minister Narendra Modi is focusing on bringing about a big victory of the BJP in Lok Sabha elections in April/May 2024.
The Supreme Court has done its constitutional duty in nullifying the electoral bonds scheme. The Supreme Court, as the custodian of the constitution, has to act as a watchdog on protecting the level playing field in the functioning of parliamentary democracy in India. (IPA Service)
By Nitya Chakraborty