Gauging The Impact Of Supreme Court's Electoral Bonds Ruling

The electoral bond scheme is violative of a voter’s right to information and goes against the fundamental rights of equality and freedom of speech and expression. This is the gist of the Supreme Court’s ruling that has struck down the scheme as "unconstitutional."

The top court, in a unanimous decision, has upheld the challenge to the scheme and struck it down because the anonymity of the donor was intrinsic to the scheme.

In essence, the judgement has been rooted in the voter’s right to information.

It’s a historic ruling and one of the few in recent history that has gone against the executive, Senior Advocate Sanjoy Ghose told NDTV Profit.

Further, the court has directed the State Bank of India to stop issuing electoral bonds forthwith and prepare up-to-date data and details of political parties that have received these bonds after April 2019. Bonds not encashed by political parties will also have to be returned to the purchasers, as per the court’s directions.

The Election Commission of India should publish the information shared by SBI on its website by March 13, the court said.

This is a seminal judgement that will have a huge effect on the way we finance our election campaigns and on the health of our democracy. The ruling is steeped in scholarship and refined by the sweep and reach of its directions, Dr Ashwani Kumar, former union minister of law and justice, told NDTV Profit.

However, Kumar said that doing away with one bad law is not enough and that there needs to be a better alternative in place.

At a primary level, political contributions grant access to legislators, which results in an apprehension that it could lead to a quid pro quo arrangement between the donor and the legislators, the court has held.

Therefore, the court observed that the amendment to Section 182 of the Companies Act, which treated companies and individuals alike for the purposes of political donations, is manifestly arbitrary, as a company exercises a much graver influence on the political process than an individual.

According to Kumar, having access to legislators and parliamentarians undoubtedly opens up an avenue for having a greater say in policy formulation, but to say that money power alone can alter the nature of the policies of the government is not completely accurate.

In any case, the people have the right to know which company or individual is contributing how much to a political party, which will aid them in making their own assessment about the possible nexus of a quid pro quo arrangement, if any, Kumar said.

According to the electoral bonds scheme, the bonds were sold in denominations of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh, and Rs 1 crore.

In its judgement, the top court has averred to a very startling fact. Based on the court’s analysis, more than 50% of the bonds in number and 94% of the bonds in value terms were meted out in Rs 1 crore denominations.

The data makes it clear that a majority of the donations were made by big players, Ghose said.

According to the latest income tax data, only a little over 2.5 lakh individuals and corporations combined earn more than Rs 1 crore annually.

In our country, where the number of people filing tax returns for an income greater than or equal to Rs 1 crore is so small, it begs the question as to who these people or conglomerates are that need this level of opacity, Ghose said.

The court has rightly directed for the donor’s information to be published in the public domain, as this will be of immense help in determining their nexus with parties, Ghose added.