In a historic ruling, the Supreme Court of India has unanimously declared the Electoral Bonds scheme unconstitutional, raising concerns about transparency in political funding and emphasizing the importance of protecting citizens’ rights.
Key Takeaways from the Landmark Decision:
- Violation of Fundamental Rights: Chief Justice DY Chandrachud highlighted that anonymous electoral bonds violate the right to information and freedom of expression, citing concerns about transparency in political funding.
- Unconstitutional Amendment: The court deemed the amendment to the Companies Act, allowing blanket corporate political funding, as unconstitutional. Contributions by companies were considered to have a potentially greater influence on the political process compared to individual donations.
- Cessation of Issuance: The State Bank of India, the issuing bank, received an order to cease issuing electoral bonds. Details of donations through electoral bonds and corresponding political parties must be submitted to the Election Commission by March 6.
- Disclosure for Accountability: The Election Commission is directed to publish all details of electoral bonds on its official website by March 13. Uncashed bonds will be refunded after this disclosure.
The court dismissed the notion that the electoral bonds scheme could justify itself by claiming to curb the flow of black money, emphasizing the need for a balance between privacy and transparency in political contributions.
Background on the Electoral Bonds Scheme:
Introduced on January 2, 2018, the electoral bonds scheme allowed anonymous contributions to political parties. Donors could purchase bearer bonds from the State Bank of India in denominations from Rs 1,000 to Rs 1 crore. The scheme was introduced through the Finance Act of 2017, amending several statutes.
Petitions and Arguments:
Petitioners contended that the electoral bonds scheme compromised citizens’ right to information about political party funding, a fundamental right under Article 19(1)(a). Senior advocate Prashant Bhushan argued that the opaque nature of the instrument promoted corruption. Attorney General R Venkataramani defended the scheme, asserting that it promoted transparency and clean money.
