Author: Snehal Rajaram Shinde, Gopaldas Jhamatmal Advani Law College
Linkedin Profile: https://www.linkedin.com/in/snehalshinde1121
To the point
This article focuses on the expenses on election campaign in India. It mentions about growing concern about the election expenses by the political parties. It explains about the current situation, as well as various judicial cases. It mentions about various issues concerning the expenses by the political parties and provides for a way forward.
Abstract
This article analyzes the growing concern over rising election campaign expenses in India. Despite statutory spending limits, political parties routinely exceed them using indirect and unaccounted means, including paid news, freebies, and electoral bonds. The paper discusses the legal framework, judicial pronouncements, and flaws in current regulation. It concludes by recommending reforms such as tighter auditing, caps on party-level expenses, and increased transparency to uphold democratic integrity.
Introduction
India is the largest democracy in the world. Various elections are held in India, throughout the year, like Lok Sabha, Vidhan Sabha, Panchayat Raj and Municipalities elections. Article 324 of the constitution mentions about the Election Commission of India, which conducts elections for Central as well as State government. The Election Commission sets limit on spendings to be done by political parties in elections.
Current Situation
The Election Commission set a limit of RS 95 lakh for the Lok Sabha election and Rs 40 lakh for the state assembly elections in 2024 elections for the larger states and Rs 75 lakh and Rs 25 lakh limit was set for Lok Sabha and state assembly elections respectively in smaller states. However, according to report of Centre for Media Studies, which is a non-profit organization the expenditure done by political parties in Lok Sabha elections in 2024 was around Rs 1 lakh crore. In 2024 Lok Sabha election the cost spending of political parties on one vote was Rs 1400 per person.
The political parties spent money on paid advertisements on social media platforms and digital platforms for promotion of schemes. They also spend their money on posters, rallies held by candidates, various freebies are also used by political parties in election campaign. The money is also spent on promoting of the candidate by means such as announcing their achievements in auto-rickshaw through loud-speakers, making songs on the achievement of that candidate.
During elections various parties arrange friendly competitions like cricket tournament or enjoyable competitions for women wherein a saree or mixer or oven are given as gifts for the winners and the participants.
The candidates should submit the report of their expenses in elections within 30 days from the date of election of the returning candidate. This is mentioned in Section 77 (1) and Section 78 of the Representation of People’s Act.
Judicial Perspective
In the case of Dalchand Jain vs Narayan Shankar Trivedi (1969) 3 SSC 685 and L.R. Shivaramagowda vs T.M. Chandrashekar (1999) 1 SCC 665, the Supreme Court stated that failure to produce the expenses within 30 days from the date of election of the returning candidate will itself be treated as corrupt practice under Section 126(6) of the ROP Act.
Issues
Although, the Election Commission has set limit on spendings by political parties in election campaign, yet it has been observed that political parties spent more than the set limit. The major loophole is that the limit is set on individual candidate participating in the election and not on the political party. This creates a loophole wherein parties or third parties spend more on elections than the prescribed limit.
According to the report of Centre for Media Studies, 2019 elections amounted to the most expensive elections with spending of Rs 60,000 crore by the political parties. There is also a great amount of unaccounted money, which is used for buying voters and distribution of freebies like cash, liquor, gifts. Also, it has been observed that parties also spend a great amount of money in “paid news”.
Electoral bonds act as double-edged swords in election campaign. Electoral bonds were introduced in 2018. They were meant to create transparency in the system. But they also amount to anonymous donations in the favor of ruling parties and reduce public accountability. Many businesses donate to political parties through electoral bonds and in return the political parties promise to make policies in their favor.
Due to these issues an uneven playing field is created in the elections wherein the wealthier candidates have more leverage and advantage in election. If the candidates will spend more money on election campaign, then in order to recover the money spend by them, they may practice corruption. Free and fair elections is the basic feature of the Constitution, therefore it will affect the democratic nature of the country. Many criminals may also fund for the political parties, which may bring the political parties in proximity with the criminals.
Way Forward
The Election Commission should be empowered more power in regard of auditing of the election expenses. The spending limit should be set on not just individual candidates but also on the political parties. The unanimous donations should not be allowed in electoral bonds, this will improve transparency and public accountability. The inclusion of digital spending should be made compulsory to the political parties. This will reduce the flow of black money in the election campaigns. Also, simultaneous elections should be preferred, if the elections are held simultaneously, they will reduce the expenditure of political parties in the elections. Since India is always under continuous election mode, due to which the political parties tend to spend money on every election. Simultaneous elections, also called as One Nation One Election will reduce this issue.
FAQS
1. What are the legal limits on election campaign spending in India?
For the 2024 elections, the Election Commission of India set the spending limits as follows:
-₹95 lakh for Lok Sabha candidates in large states
-₹40 lakh for State Assembly candidates in large states
-₹75 lakh and ₹25 lakh respectively for Lok Sabha and Assembly candidates in smaller states
These limits apply only to individual candidates, not to political parties.
2. How do political parties exceed these spending limits despite regulations?
Political parties spend beyond the official limits by using third-party expenditures, unaccounted money, and loopholes—since limits apply only to individual candidates, not to parties. They spend on digital ads, rallies, paid news, and distribution of freebies such as cash, liquor, or household items.
3. What is the role of electoral bonds in election campaign finance?
Electoral bonds, introduced in 2018, were intended to ensure transparency. However, they allow anonymous donations, which largely benefit ruling parties. This reduces public accountability and raises concerns over corporate influence in policy-making.
4. What legal provisions govern the reporting of election expenses?
Under Section 77(1) and Section 78 of the Representation of the People’s Act, candidates must submit their expense reports within 30 days of the result declaration. Failure to do so is considered a corrupt practice, as held by the Supreme Court in key judgments like Dalchand Jain v. Narayan Shankar Trivedi.
5. What reforms are suggested to regulate election campaign spending more effectively?
-Empowering the Election Commission to audit party finances
-Imposing spending limits on political parties, not just candidates
-Banning anonymous donations via electoral bonds
-Mandating disclosure of digital spending
-Promoting simultaneous elections to reduce repeated expenditures
