Author: Yash Suresh Khiste, The Manikchand Pahade Law College, Chhatrapati Sambhaji Nagar, Maharashtra
To the Point
Political funding plays a vital role in a democratic setup, but the lack of transparency can corrode the system from within. The Electoral Bonds Scheme, introduced to clean up political funding, has instead raised concerns over opacity, donor anonymity, and favoritism — all of which warrant constitutional scrutiny.
Use of Legal Jargon
– Electoral Bonds
– Right to Information (RTI)
– Money Bill
– Proportionality Test
– Judicial Review
– Anonymity of Donor
– Political Patronage
– Ultra Vires
– Legislative Competence
– Doctrine of Manifest Arbitrariness
The Proof
– As per a 2023 report by the Association for Democratic Reforms (ADR), 94.5% of the total electoral bonds were redeemed by only four political parties.
– The Election Commission of India (ECI) expressed strong opposition to the scheme in a 2019 affidavit, citing a severe blow to transparency.
– The State Bank of India (SBI), the only authorized bank to issue and redeem bonds, refused to disclose donor details under RTI.
Abstract
Electoral Bonds were introduced by the Government of India in 2017 through the Finance Act, 2017, which amended several key legislations like the Representation of the People Act, 1951, and the Companies Act, 2013. Though projected as a reform to curb black money, these bonds have made the political donation process opaque and legally questionable. This article analyzes the legal structure, the constitutional validity, associated case laws, and potential reforms to ensure transparency in political funding.
Case Laws
Association for Democratic Reforms v. Union of India (2002)
The Supreme Court held that citizens have a right to know about political candidates and parties under Article 19(1)(a).
PUCL v. Union of India (2003)
The Court upheld the right to information about candidates’ criminal, educational, and financial background as a fundamental right.
CPIL v. Union of India (2019 – ongoing challenge)
Constitutional challenge to the Electoral Bonds Scheme, questioning its legality and violation of Article 14 and Article 19.
K.S. Puttaswamy v. Union of India (2017)
Reaffirmed the right to privacy and proportionality as essential tests for restrictions on fundamental rights.
Conclusion
The Electoral Bonds Scheme, though introduced with a noble intention to cleanse political funding, has led to a more opaque system favoring the ruling parties. It undermines citizens’ right to information, tilts the balance of power, and raises serious questions about accountability and fairness in elections. Transparency in political financing is not just a legal necessity but a democratic imperative. The Supreme Court must act decisively to uphold the constitutional values of equality and informed choice.
FAQS
Q1. What are electoral bonds?
Electoral bonds are bearer instruments that can be purchased by individuals or companies and donated to a political party anonymously.
Q2. Are electoral bonds legal?
While they are currently legal, their constitutional validity has been challenged in the Supreme Court for violating Articles 14 and 19(1)(a).
Q3. Who can issue electoral bonds?
Only the State Bank of India (SBI) is authorized to issue and redeem electoral bonds.
Q4. Why are electoral bonds controversial?
They allow unlimited corporate donations without disclosure, thereby removing transparency and enabling quid pro quo arrangements.
Q5. What is the Supreme Court’s stand?
As of now, the matter is pending before the court, but multiple interim hearings have raised serious concerns regarding donor anonymity and transparency.
