Electoral bonds: The court disappoints

The Supreme Court has lost out on yet another opportunity to ensure a clean democracy when it decided not to impose a stay on the electoral bond scheme which threatens the sanctity and legitimacy of elections. The decision comes on the plea filed by the Association for Democratic Reforms, in the context of the upcoming assembly elections, asking for all bonds from April 1 to be stayed. Not only are the justifications given strange (that the same bond distribution had happened in 2018 and 2019, and that the beneficiaries are not only the ruling party), but it also seems the court has not taken into consideration the serious concerns raised by the Election Commission and the Reserve Bank of India.

The system of using electoral bonds to raise money has been in place for three years now. Advocates of democracy have been against this from the beginning due to the lack of transparency and the potential for corruption within it. Political parties can accept unlimited bonds from unnamed corporates, including those abroad. In this manner, the bond system legalises corruption. The voter is denied her right to know from where the parties requesting vote receive their funds. Secondly, the sale of bonds is in a manner without scrutiny or limit of amounts which thereby leaves room for money power. Further, it leads to the negation of the principle of equality of opportunity for different political parties and the ruling party enjoying unrestrained clout and benefit over the rest. Only the State Bank of India is authorized to sell electoral bonds meaning that the government has eventually access to information on parties and their donors. This exerts an indirect pressure on the donors and creates a space to block potential funds for the parties not in power. This is easily vouched for by the fact that over 95% of donations in the first round of electoral bonds went to the BJP. It did not change much in the next rounds either. Additionally, the fact that over 99% of the bonds being between 1 crore and 10 lakhs testify to yet another interesting detail: it is corporates that are spending money on the bonds. Aren't the bills being tabled and passed by legislatures a visible return of such favours?

Although introduced with claims that bonds will stop black money from entering elections, in reality they merely open doors to new avenues of corruption. Donor sources are not disclosed - however, the government can easily find that information while the people and the opposition are left in the dark. Proxy companies abroad can bring in black money- and as long as it is being given to the ruling party, the deal is secure for them. The finance bills passed by the centre in 2016 and 2017 were basically to grant legitimacy to illicit electoral transactions. To bypass the Rajya Sabha where they did not have the needed majority, they even passed amendments to the Representation of the People Act under the category of finance bill. These four amendments passed in a similar fashion authorize these electoral deals in favour of the ruling party. The Foreign Contribution Regulation Act was amended in such a way as to allow foreign corporates to fund electoral parties through their Indian subsidiaries; the 7.5% cap (of a company's annual profits) on donations by corporates was done away with; transparency laws that mandated disclosing to which political outfit companies were donating, were removed; and to top it all, the RBI laws were amended to bring in the opaque system of electoral bonds. Both the EC and the RBI had warned of the dangerous implications this posed and had notified the same to the court.

However, it looked as though the court was trying to find any reasons available to justify the bond system of donations. It even went so far as to claim that companies and political parties both make public their annual financials and discrepancies can be identified there. The pleas against electoral bonds had reached courts back in 2017 after the controversial financial bill was passed. The pleas were not heard when elections happened for the Lok Sabha or the several state assemblies. Money flowed in through electoral bonds back then. And now, the same court which did not consider the pleas then is saying that things had happened smoothly back then, so what is the need to stop bonds now? Thus if any irregularity happened then, even that is now being cited as a justification.

Now, one can only hope that the bench headed by Chief Justice SA Bobde will consider the arguments raised by the RBI, the EC, and concerned citizens who have faith in democracy and put an end to the electoral bond system to save the nation.