SC seeks Centre's reply on CPI(M) plea against electoral bonds

The Supreme Court today sought the Centre's response on a plea by the CPI(M) and its general secretary Sitaram Yechury against the government's decision on issuing electoral bonds.
The plea claimed that government's decision entitles political parties to receive unlimited donations without recording its source.
A bench of Chief Justice Dipak Misra and justices A M Khanwilkar and D Y Chandrachud issued notice to the government on the plea and said it will be tagged along with a pending petition.
Challenging the Centre's decision, the CPI(M) said that the amendments in the Finance Act, 2017, jeopardise the very foundation of Indian democracy and it would lead to greater political corruption.

The petition claimed that the introduction of electoral bonds by the Finance Act by which details of donations made to political parties are not reported or recorded by the parties and whose purchasers' identity remains hidden from the public realm is the creation of an "obscure funding system" which is unchecked by any authority.
"The requirement of disclosure of such bonds and the names and addresses of their contributors in the account statement of political parties is omitted by the amendment to the Representation of the People Act," the petition, filed through advocate Shadan Farasat, said.

It sought striking down of amendments made through the Finance Act, 2017 and the January 2, 2018 notification issued by the Ministry of Finance, whose cumulative effect is that political parties are entitled to receive unlimited donations from individuals and corporations, including loss-making and foreign corporations, without having to record or report the sources of such funding.

It sought to declare certain provisions of the Finance Act and the corresponding amendment in the Reserve Bank of India Act, the Representation of the People Act and the Companies Act as "arbitrary", "unconstitutional, illegal and void".
"The system of corporate donations has been made correspondingly secretive by removing the requirement of disclosure of the names of political parties to whom contributions have been made by amendment to the Companies Act," it said, adding that, at both ends of the transaction, neither the contributor nor the recipient of funds is required to be disclose the identity of the other.
The petition contended that quid pro quo arrangements, not unknown to Indian polity, will only be strengthened.

It said that the intention of government in introducing the 'Electoral Bond Scheme, 2018' has been stated by the Finance Minister for introducing transparency and reducing the use of black money in the financing of political parties.
However, the plea claimed that neither of these objectives is achieved by the provisions of the scheme.
The NDA government had announced electoral bonds in the previous budget, claiming that the scheme would clean up political funding.
The move was resisted by opposition parties. The Election Commission of India had also expressed its reservations initially.