Supreme Court to deliver verdict on pleas challenging electoral bonds today
The Supreme Court will deliver its verdict on a series of pleas challenging the legal validity of the electoral bonds scheme.
The decision will be delivered on Thursday by a five-judge constitution bench, led by Chief Justice of India DY Chandrachud, scheduled for 10:30 am.
Launched in January 2018, electoral bonds are financial instruments that individuals or corporate entities can purchase from a bank and present to a political party, which can subsequently redeem them for funds.
The scheme was pitched as an alternative to cash donations made to the political parties of the country, as an attempt to bring transparency in political funding.
The Supreme Court will deliver its verdict on a series of pleas challenging the legal validity of the electoral bonds scheme. The decision will be delivered on Thursday by a five-judge constitution bench, led by Chief Justice of India DY Chandrachud, scheduled for 10:30 am.
Launched in January 2018, electoral bonds are financial instruments that individuals or corporate entities can purchase from a bank and present to a political party, which can subsequently redeem them for funds.
The scheme was pitched as an alternative to cash donations made to the political parties of the country, as an attempt to bring transparency in political funding.
The top court had reserved the verdict on November 2 after a three-day hearing on the batch of pleas.
During the proceedings, Solicitor General Tushar Mehta, representing the Centre, asserted that the Electoral Bond scheme ensures fair usage of funds for political purposes through proper banking channels.
He emphasised the need to maintain the confidentiality of donor identities to protect them from potential retribution by political parties.
The Centre suggested that if the Supreme Court desires, it can designate the Reserve Bank of India (RBI) as the statutory bank to issue electoral bonds instead of the State Bank of India (SBI), as per the existing scheme.
During the hearing, CJI Chandrachud proposed exploring alternative systems for political donations to address flaws in the current electoral bonds system without reverting to a cash-only system.
“We do not want to go back to a cash only system. We are saying do it in a proportionate, tailor made system which overcomes the serious deficiencies of this electoral bond system. You can still devise a system which balances out in a proportional way. How it is to be done is for you to decide. We will not step into that arena, that is not part of our function,” he said.
On the issue of how money flows into the system, the Chief Justice said, “But if a company shows it has one rupee profit but it donates Rs 100 crores, the reason why these caps were introduced because there was a company and purpose was to carry on business and not donate to political purposes, assuming it is not a altruistic model”.
During the hearing, concerns were raised about the transparency of electoral bonds. Solicitor General Mehta clarified that the current system prevents the creation of shell companies and ensures clean money flows into the system.
Petitioners argued that electoral bonds undermine the public’s right to be informed and serve as opaque, anonymous instruments that foster corruption in the country.
Senior Advocate Kapil Sibal, representing Congress leader Jaya Thakur, contended that the entire process is anonymous, as the purchase of these interest-free bonds does not require declaration, and political parties are not obligated to disclose the source of the money.
The Supreme Court’s order will pertain to a batch of petitions challenging at least five amendments made to different statutes through the Finance Act 2017 and Finance Act 2016. The petitioners argue that these amendments have opened doors to unlimited, unchecked funding of political parties.
Menawhile, the top court had criticised the Election Commission of India (ECI) for not maintaining donor data and the quantum of contributions to political parties, seeking a detailed report on all donations until September 30, 2023.
Counsel appear for the poll body, informed the bench that data had been collected only for the year 2019.