SC Verdict On electoral Bonds May Open a Pandora's Box

 The Supreme Court’s decision to strike down the electoral bond scheme as it was “unconstitutional” and against the Right to Information has potential to kickstart a new chapter in India’s political journey. The court ordered the State Bank India to provide the Election Commission of India (ECI) with detailed records of all electoral bond contributions received by political parties till today.

The ECI is expected to receive comprehensive data from SBI within three weeks. Once the information is collected, the ECI has instructed the Supreme Court to publish these details on its official website, ensuring transparency and public access to the information.

THE INTRODUCTION

The electoral bonds scheme, introduced in 2018, was intended to increase transparency in political donations. However, the anonymity provided by the scheme fostered corruption and upset the level playing field among political parties, the petition challenging the scheme had claimed.

The amendments made by the Finance Act 2017 that created the electoral bonds scheme had created a secrecy surrounding these bonds as it reduced transparency in political funding violating voters' right to know, the petition had alleged. It also said the scheme allows contributions from shell companies.

The central government defended the scheme, saying it ensures that only legitimate money is used for political funding through proper banking channels. They argued that keeping donors' identities secret protects them from retaliation by political parties.

WHO BENEFITTED

Of the total electoral bonds worth Rs 12008 crore sold between 2018 and 2023, the ruling BJP received Rs 6564 crore (55 per cent). Congress received just 9.5 per cent (1135 crore) while Trinamool Congress received Rs 1,096 crore from electoral bonds, DMK Rs 306 crore, the BJD Rs 291 crore and the YSR Congress Rs 60 crore. All these parties are in power in one or more states. The Bharat Rashtra Samithi was the biggest recipient among regional parties in 2022-23, getting Rs 529 crore.

Electoral bonds in India are financial instruments introduced by the government in 2018 as a mechanism for political funding. These bonds were intended to provide a formal and transparent way for individuals and corporations to make donations to political parties. The issuance of electoral bonds is managed by authorized banks, and these bonds can be purchased by eligible donors in multiples of fixed denominations.

POTENTIAL CONTROVERSY

However, once the SBI and the ECI provide the details, people would come to know which corporate gave how much money to a national or regional party. The issue has the capability of snowballing into a major controversy as it comes just days before the announcement of Lok Sabha elections. The details might also bring out cases of quid pro quo by the centre or some state government.

More cases related to electoral reforms are pending before the apex court. The most prominent among them is the petition challenging Election Commission appointment procedure. The government acting upon a Supreme Court verdict, passed a law some time back including the PM, Law Minister, and Leader of Opposition in the screening and appointment committee. This composition means the government dominates the committee and may appoint anyone it chooses, thereby undermining the impartial nature of the ECI. The SC had earlier, decreed that the committee would have CJI besides PM and LoP in the committee. The government overruled the verdict by enacting the law. The SC is expected to start hearing this petition shortly.