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Sunday, May 19, 2024, 4:55 am

Sunday, May 19, 2024, 4:55 am

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The Court’s unequivocal “no” to electoral bonds.

The Court's unequivocal "no" to electoral bonds.
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The Supreme Court of India’s ruling on February 15, 2024, invalidating the electoral bonds programme, is a significant development. Transparency is essential to democracy, and the electoral bonds programme was inherently opaque.
Indian voters are unaware of who and how much money has been contributing to political parties.
Campaign finance is based on transparency in all major democracies. That openness has been reinstated by the Court.

Funding restrictions are lifted.
There are further legal concerns. The first is a business house or organization’s financial cap.
As before, this sum is restricted globally to avoid having an excessive impact on the government. This was a provision that existed in India prior to the introduction of electoral bonds. As per the verdict, corporations primarily support political parties in order to influence the political process, which might potentially enhance the company’s commercial success.

The previous restrictions on how much a firm may give to political parties with its profits were also lifted by electoral bonds. Even loss-making businesses were permitted to donate under the system. Shell corporations could have been established as a result in order to transfer money to political parties. This raises the prospect that shell corporations would be established with the express intent of donating money to political parties, according to the Election Commission of India. This has also been overturned by the Court.

During a period of crony capitalism, large corporations sponsored political parties in democracies. Laws, rules, plans, and incentives were developed for the benefit of the contributors in exchange. The ruling of the Supreme Court of India restricts this to a certain extent. The Finance Bill was subject to an amendment. The Finance Bill was subject to an amendment.
The only entity with the power to print money, including notes and bonds, is the central bank of each nation. According to Section 31 of the Reserve Bank of India (RBI) Act, “only the RBI or the Central Government authorized by the RBI Act shall draw, accept, make or issue any bill of exchange or promissory note for payment of money to the bearers of the note or bond”.

Government authorized by the RBI Act shall draw, accept, make or issue any bill of exchange or promissory note for payment of money to the bearers of the note or bond”. Through the use of a Finance Act, the Government modified the RBI Act, allowing the central government to approve any scheduled bank to issue electoral bonds under a new provision (31-3). The Finance Act’s modification has also been rejected.

A thoroughly considered strategy

We must take a moment to comprehend a few things. Since the Rajya Sabha is not required to approve the Finance Bill, the Amendment to the RBI Act was approved. The ruling party wished to avoid a vote in the Upper House and lacked a majority in the Rajya Sabha at the time the electoral bonds programme was introduced. But can a Finance Bill include any issue? The provisions of a Finance Bill have nothing to do with electoral bonds. The RBI Act of 1934, the Companies Act of 2013, the Representation of the People Act (RPA), 1951, and the Income Tax Act of 1961 were among the legislation that were modified to allow for the introduction of electoral bonds. It had been well considered. It was a reaction to a Central Information Commission (CIC) decision requiring political parties to disclose all of their financial information in full transparency. The purpose of the electoral bonds was to get around the CIC decision. But why do political parties oppose openness so much?

For the so-called average voter and citizen, the legal system is still unclear. Layers of obfuscation are applied to a system that strikes at the heart of democracy, namely transparency, when four laws are altered to implement it. This causes citizens to lose interest in attempting to comprehend the programme. But these aren’t problems with technology. These are problems that impact democracy’s fundamental principles.

This also brings up important democratic principles. Any Bill that is approved by a majority of the government can become law. Unlike in the US, governing party members in India are required to vote in support of the government and there is no such thing as an independent vote. This implies that virtually any law may be passed by a small group of powerful members of the ruling party. Parliamentary debates and public consultation procedures were not followed in the case of electoral bonds.

The main points of the verdict

Here is a summary of the Supreme Court’s ruling. The plan for electoral bonds has been declared invalid. Constitutional Articles 19 and 14 are violated by all amendments made to the RPA Act, the Finance Act of 2017, and the Companies Act of 2013. Arbitrariness in law is prohibited under Articles 19 and 14, which deal respectively with the right to equality and the right to knowledge. The Indian Constitution’s Fundamental Rights include these Articles, which are untouchable. The only bank that accepts payments in return for electoral bonds, the State Bank of India (SBI), has been ordered by the Supreme Court to cease issuing them.

The Election Commission of India (ECI) must receive the complete record of all electoral bonds that the SBI has issued by March 6, 2024. The ECI then has two weeks to post this information on its website.
It is important to remember that the Supreme Court and the ECI, two constitutional bodies, have acted in support of democracy. Judicial review of laws approved by Parliament based on the Constitution is a valuable power. We should honour the people who drafted the Constitution and their efforts.

Money in politics is still a problem, as seen by the use of “black money” and the bribery of voters with gifts and campaign expenditures. It is claimed that perpetual vigilance is the price of democracy. Citizens’ diligence resulted in the Supreme Court’s decision. It is our responsibility to make sure that political parties serve the interests of society and the country, even though we need them.

Abhishek Verma

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