New Delhi: The Supreme Court on Wednesday reserved its order on a plea seeking a stay on electoral bonds till the conclusion of Assembly elections in four states beginning from March 27.
The plea by NGO Association for Democratic Reforms, filed through senior Advocate Prashant Bhushan, claimed that the electoral bonds scheme invites corruption as shell companies will purchase bonds for parties in form of bribe for receiving favours.
Bushan mentioned about the Reserve Bank of India who had called the scheme as “fraud” with implications on the banking system.
He also questioned the clause of the scheme of keeping the secrecy of the donar as no one except the State Bank of India knows the identity of the donar. He stated at least the identity should be shared with the RBI.
“The only person who wants anonymity is the person who is paying bribe to the party,” Bhushan said as quoted by Live Law.
When the bench headed by Chief Justice of India S A Bobde questioned how only ruling party will get benefitted as the scheme is for all parties, Bhushan replied that only ruling party is in the position of returning favours, so it is more likely that the lion share of electoral bonds will be for it.
Bhushan also raised objections in the way the provisions of the electoral bond scheme were applied by through amendments in a Finance Bill.
He said it was unconstitutional to make amendments through Finance Bill and the government did so to make sure the bill is not applicable to go through Rajya Sabha where the majority of the government is in question.
The ECI appearing through Advocate Rakesh Dwivedi told the court that the commission was not opposed to the bond scheme as it promotes digital transactions and transparency.
“Without electoral bond system we will return to cash system which was unaccounted. All transactions are through bank channels,” he said.
The Attorney General of India K K Venugopal, appearing for the Centre, told the court that the electoral bonds will go for sale from April 1 to 10 and it was step to eradicate black money.
The AG stated that the donar’s identity have been kept hidden to prevent them from victimisation.
The CJI expressed apprehensions that the political parties can use the electoral bonds for other activities too.
“…it is possible through electoral bonds funds are diverted by particular persons for other purposes with an agenda,” CJI Bobde remarked.
The AG said the validity of the bonds is just 15 days and after that “it is just paper”.
In 2017, the Finance Act was amended to implement electoral bond scheme under which bonds can be bought of any value in multiples of Rs 1000, Rs 10,000, Rs 1 lakh and Rs 1 crore from the SBI by anyone. The name of the donar will not be there on the bond while the validity of the bond will be for 15 days. The eligible political parties—with more than one per cent voting share—can show it as the income from voluntary contributions for exemption from income tax.
The scheme was challenged by many opposition parties, NGOs and others.
In April 2019, the Supreme Court asked the political parties to submit in a seal cover the donations they had received through electoral bonds.