Political Funding Under Scrutiny : SC asks EC to produce up-to-date data on funds received by parties through electoral bonds

02-11-2023 : The Supreme Court, in its recent proceedings, has requested the Election Commission to provide “up-to-date” data on funds received by political parties through electoral bonds until September 30. A five-judge bench, headed by Chief Justice of India D.Y. Chandrachud, has instructed the poll panel to deliver this data to the registrar (judicial) of the apex court in a sealed cover. The bench, which includes Justices Sanjiv Khanna, B.R. Gavai, J.B. Pardiwala, and Manoj Misra, has also reserved its verdict on a set of petitions challenging the central government’s electoral bond scheme.

The Supreme Court’s involvement in this matter dates back to an interim order issued on April 12, 2019, when it directed political parties to disclose the details of funds received through electoral bonds to the Election Commission. Referring to this order, the court emphasized that its scope was not limited to the date it was pronounced. It expressed the view that if there was any ambiguity, the Election Commission should have sought clarification from the court.

Advocate Amit Sharma, representing the Election Commission, had previously stated that the Commission believed the order pertained only to electoral bonds related to the 2019 Lok Sabha polls. In response to this, the bench issued an order directing the Election Commission to produce up-to-date data until September 30, 2023, in accordance with the interim direction from April 12, 2019.

The electoral bond scheme has been a subject of debate and contention. Critics argue that it is unconstitutional, undemocratic, and unfair, and that it undermines the fundamental structure of the Constitution. However, the court has expressed its preference for addressing the deficiencies in the current system while not reverting to a cash-only system. The central government maintains that the scheme promotes transparent political funding and prevents the inflow of black money or unaccounted funds. Various parties and NGOs, including Congress leader Jaya Thakur, the Communist Party of India (Marxist), and the Association for Democratic Reforms (ADR), have filed petitions challenging amendments made to different statutes through the Finance Act 2017 and Finance Act 2016, asserting that these changes have allowed “unlimited and unchecked” funding of political parties. The Supreme Court’s final verdict on this matter will have significant implications for the electoral funding landscape in India.

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