Parties must name donors but in covers

The apex court refused to stay for now the electoral bond scheme

By PTI in New Delhi
  • Published 13.04.19, 6:28 AM
  • Updated 13.04.19, 6:28 AM
  • 3 mins read
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The Election Commission Picture: Prem Singh

The Supreme Court on Friday directed all political parties to reveal the donations they had received in electoral bonds and the identities of the donors to the Election Commission in a sealed cover by May 30, trying to bring transparency to the system of anonymous poll funding.

In the interim order delivered amid the April 11-May 19 Lok Sabha polls, the apex court said the political parties must provide “detailed particulars of the donors as against each bond; the amount of each such bond and the full particulars of the credit received against each bond, namely, the particulars of the bank account to which the amount has been credited and the date of each such credit”.

It, however, refused to stay for now the electoral bond scheme, which allows anonymous donors to buy bonds from banks to fund political parties. But it directed the Union finance ministry to reduce the window for purchasing electoral bonds from 55 days to 50 days in 2019.

An NGO, the Association of Democratic Reforms, had moved a petition challenging the validity of the scheme. It had sought either a stay on the issuance of electoral bonds or a directive to make the donors’ names public.

The court said it would on April 15 hear in depth the arguments of the petitioner, CPM, government and the poll panel, which have raised “weighty issues” having “tremendous bearing on the sanctity of the electoral process in the country”.

“The court, therefore, has to ensure that any interim arrangement that may be made would not tilt the balance in favour of either of the parties but that the same ensures adequate safeguards….”

Opposition parties, which allege the scheme reflects a nexus between the BJP and its wealthy friends, welcomed the court order as a step towards transparency in political funding. The BJP said it would wait for the final judgment.

On Thursday, the apex court had said that if the identities of the buyers of the electoral bonds remained unknown, the government’s efforts to curtail black money in elections would be “futile”.

The bench of Chief Justice Ranjan Gogoi and Justices Deepak Gupta and Sanjiv Khanna on Friday rejected the Centre’s contention that the court must not interfere with the scheme now and should examine whether it has worked only after the general election.

It said it would examine in detail the changes made to the laws relating to income-tax, elections, banking, finance and foreign contributions to make them consistent with the electoral bond scheme, notified on January 2 last year.

The Centre and the Election Commission have taken contrary stands in the apex court, with the poll panel seeking revelation of the donors’ names for transparency.

Represented by senior lawyer Rakesh Dwivedi, the poll panel had argued that the secrecy allowed in the electoral bond scheme “legalises anonymity”. It said its objections were “exclusively confined to one of transparency in political funding and not on the merits of the scheme”.

Congress spokesperson Priyanka Chaturvedi said the court order would bring out the “nexus” between the BJP and its “suited-booted friends”.

CPM general secretary Sitaram Yechury said the apex court had “demolished” the government’s stand. “Supreme Court demolishes stance taken by Modi, Jaitley & BJP --- which had pushed this as a money bill, for opaque, secret electoral bonds,” he tweeted.

“The court says transparency is the basic principle of electoral funding. People have a right to know which party got how much, and from whom.”

In another tweet, he said: “Anonymity pushed by BJP is on the way out. Donors of black money via this route will be scared to fund from here on. Today EC has the data. Tomorrow the public will also have it.”

Advocate Prashant Bhushan, who appeared for the petitioner, had claimed during an earlier hearing that the party in power was the major beneficiary of the electoral bond scheme.

“Whatever is the order of the Supreme Court, it has to be complied with and it is always complied with,” BJP spokesperson and Supreme Court lawyer Nalin Kohli said.

“As far as (the) issues raised by the government are concerned, they have been placed before the court for its consideration. And we will await the final judgment.”

Attorney-general K.K. Venugopal, representing the Centre, had said the purpose behind the scheme was to eliminate the use of black money in elections. He had argued that the anonymity of the donors needed to be maintained for various reasons, such as the fear of repercussions if the rival group won.

Venugopal had further asserted that “transparency cannot be the mantra” and asked why the voter needed to know the source of political funding.

In its affidavit, the Centre had said the electoral bonds “attempt at bringing greater transparency, ensuring KYC compliance and keeping an audit trail in comparison to the earlier opaque system of cash donations”.

Any Indian citizen can buy electoral bonds, singly or with others, and so can any entity incorporated or established in India.

Only political parties registered under Section 29A of the Representation of the People Act, 1951, are eligible to receive electoral bonds, and only if they secured at least 1 per cent of the votes polled in the previous Lok Sabha or Assembly election.

An eligible political party can cash an electoral bond only against a bank account with an authorised bank. Electoral bonds have a validity of 15 days from the date of issue. 

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