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EC not for electoral bonds, opposes Centre’s position

The EC expressed concern at legislative changes that allowed the use of electoral bonds for anonymous funding of elections, warning this would have “serious repercussions” on the transparency of the electoral process.

india Updated: Mar 28, 2019 08:33 IST
Bhadra Sinha
Bhadra Sinha
Hindustan Times, New Delhi
Election Commission of India,EC,India news
People walk past the Election Commission of India office building in New Delhi, India March 11, 2019. (REUTERS FILE PHOTO)

The Election Commission of India (ECI) on Wednesday expressed concern at legislative changes that allowed the use of electoral bonds for anonymous funding of elections, warning this would have “serious repercussions” on the transparency of the electoral process.

It also said changes in the Foreign Contribution Regulation Act, 2010 could “allow unchecked foreign funding of political parties”, raising the spectre of foreign influence on India’s politics and policies.

Both positions, expressed by the body that conducts polls in India in an affidavit filed in the Supreme Court, go against those of the Central government.

The affidavit was filed by the ECI’s director (legal), Vijay Kumar Pandey, on behalf of the poll watchdog.

In its affidavit filed before the Supreme Court on Tuesday, the commission said that it had conveyed its apprehension over electoral bonds way back in 2017 when an amendment was brought to the Finance Act, 2017, and the Representation of People’s Act, 1951, (RPA) introducing the bonds. ECI also put on record the two letters it wrote to the government, one on March 15, 2017, and the other on May 26, 2017, voicing its concern.

Not only did it speak out against electoral bonds in 2017, ECI also recommended doing away with the anonymity clause for donations of less than ₹20,000. This secrecy is provided under the RPA rules. ECI said that based on the Law Commission of India’s report of 2015, the poll body advised amendment to Form 24-A so as to ensure that even contributions less than ₹20,000 are not anonymous.

The court will hear the election body’s stand on April 2.

ECI filed its affidavit pursuant to the apex court’s direction for its response to two petitions — one by NGO Association for Democratic Reforms (ADR) and the other by Communist Part of India-Marxist (CPI-M) challenging the National Democratic Alliance (NDA) government’s decision to issue electoral bonds for funding of elections in the country.

The NDA government defended its decision earlier this month before the court and said the changes were made in the interests of transparency.

In an affidavit, the government said the electoral bond scheme notified last year would remain anonymous to maintain the privacy of its buyers although the identity can be disclosed before a competent court or upon registration of a criminal case by any law enforcement agency.

An official in the law ministry, who spoke on condition of anonymity said: “This is the recognised way of funding. The decision was taken long back without any objection [by ECI].”

Electoral bonds were introduced after changes in the Finance Act 2017; there were related amendments in the Income Tax Act, the Reserve Bank of India Act, and the Representation of People Act. Even foreign companies can buy electoral bonds. In its petition, the CPI(M) claimed that the non-disclosure clause would add to the woes of Indian democracy. A bench headed by the then Chief Justice Dipak Misra issued notice to the government in the case in October last year.

The Bharatiya Janata Party (BJP) was the biggest beneficiary of the electoral bond scheme in 2017-18, receiving bonds worth around ₹210 crore of the ₹215 crore issued. As per the audit and income tax reports submitted by the party to the ECI, it earned ₹210 crore through electoral bonds, while the Congress, which earned ₹199 crore as income in 2017-18, got only ₹5 crore in donations from electoral bonds. When the bonds were announced in 2017, the ECI differed with the Centre’s view that their introduction would make the process transparent. The poll panel found the mode of donation to political parties to be opaque.

Several political parties have also questioned the efficacy of bonds as a means of ushering in transparency. The bonds can only be credited into the accounts of registered parties; are available for a period of 10 days each in the months of January, April, July and October, with an additional period of 30 days specified by the Central government in the year of general elections.

First Published: Mar 27, 2019 23:11 IST