The Supreme Court has declared the Electoral Bond scheme unconstitutional, as Prashant Bhushan celebrates the comprehensive acceptance of filed petitions. The unanimous decision emphasizes the violation of citizens’ right to information and the rejection of unlimited corporate funding.
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The Supreme Court of India has declared the Electoral Bonds scheme as unconstitutional, bringing an end to a controversial method of political funding. The verdict came as a significant victory for those who had filed petitions challenging the scheme.
Senior advocate Prashant Bhushan expressed his satisfaction with the outcome, stating-
“The Supreme Court has struck down the electoral bond scheme, comprehensively struck it down, and all the provisions that were made to bring it into effect in the Income Tax Act, in the Companies Act, etc. Everything has been struck down.”
The Supreme Court, in a unanimous decision delivered by a five-judge bench comprising Chief Justice India DY Chandrachud, Justices Sanjiv Khanna, BR Gavai, JB Pardiwala, and Manoj Misra, addressed the petitions challenging the legal validity of the Central government’s Electoral Bonds Scheme.
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The court emphasized that the scheme violated the fundamental right to information, specifically citizens’ right to know about political contributions. Advocate Shadan Farasat concurred, remarking,
“Supreme Court has unanimously struck down the electoral bond amendments. The amendments that were the basis of the scheme have been struck down from different enactments like the Income Tax Act and others.”
The main issues raised in the petitions were whether the amendments were violative of the right to information under Article 19(1)(a) and whether unlimited corporate funding violated free and fair elections.
The Supreme Court ruled that information about corporate contributors through Electoral Bonds must be disclosed, as the donations by companies are purely for quid pro quo purposes. The court further held that amendments in the Companies Act permitting unlimited political contributions by companies are arbitrary and unconstitutional.
Quid pro quo –
A mutual agreement between two parties to exchange goods or services, where one transfer is dependent on a corresponding transfer from the other party.
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Prashant Bhushan highlighted the comprehensive nature of the court’s decision, stating-
“So not only the electoral bond scheme but also the amendment which removed the restrictions on political contributions by companies, which were that you cannot contribute more than seven and a half per cent of your annual profit by way of political contributions. That has also been struck down as violating the level playing field in a democracy.”
The Electoral Bond, described as an instrument in the nature of a promissory note or bearer bond, allowed individuals, companies, firms, or associations of persons to contribute funds to political parties while maintaining anonymity. The Centre, defending the scheme, had argued that it provided a transparent mode of political funding, making it impossible to involve black money or unaccounted funds.
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The court’s decision, stemming from petitions contesting amendments introduced in the Finance Acts of 2017 and 2016, represents a pivotal stride towards fostering transparency in political funding.
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