Electoral Bonds issue: SC slates matter for hearing on April 10

The Supreme Court on Friday adjourned till April 10 hearing in the plea challenging the validity of electoral bonds.

The top court bench was hearing a petition filed by the Association for Democratic Reforms (ADR) challenging the validity of electoral bonds, unlimited corporate funding, and transparency in political funding.

A bench headed by Chief Justice Ranjan Gogoi was of the view that the matter requires a detailed hearing and hence, slated it for further consideration on April 10.

During the course of the hearing, Advocate Prashant Bhushan, appearing for the petitioner said that thousands of crores of rupees are flowing into ruling party coffers from anonymous donors adding that anonymity of electoral bonds has ensured that majority of these go to the ruling party

Replying to the advocate, Attorney General KK Venugopal, appearing for the Centre said that Bhushan is making an election speech. Electoral bonds curbed black money.

On Wednesday, the Union of India (Finance Ministry) filed an affidavit before the court saying that electoral bonds is a positive step in the right direction to ensure "accountability and transparency" in conducting elections, adding that these bonds were introduced to deal with the menace of corruption in elections.

Last week, the poll panel had filed an affidavit and said that it had informed the Ministry of Law and Justice that changes in the law allowing electoral bonds would have "serious repercussions" on the transparency of funding to political parties.

From the changes in law, any donation received by a political party through an electoral bond has been taken out from the ambit of reporting, and it would be difficult to ascertain if the political parties received donations from government companies or foreign sources, the EC had said in its affidavit.

The Centre in its affidavit said the concern of the EC that electoral bonds will enable foreign companies to influence Indian policies is "without any legal or factual merit".

The government further said it was observed that political parties were floated, without any serious intention of contesting elections, merely for the purpose of being utilized as vehicles for generating/handling large amounts of tainted cash.

Under the earlier provision of the Act, there was no limit on the amount of contribution or donation was made in cash to the political parties. Since the major proportion of the amount of political funding was in the form of cash, the existing provision allowed the source of funding to remain unaccounted/unexplained. At the same time, there was a concern among the donors that, with their identity revealed, there would be competitive pressure from different political parties receiving the donation, the affidavit stated.

Explaining these circumstances to introduce the Electoral Bonds Scheme, the government said that considering the need to impart greater accountability in funding of political parties as well as to maintain the anonymity of the donor, a mechanism of political funding by way of electoral bonds was introduced.