Supreme Court Commences Hearing on Electoral Bonds Case with High Stakes for 2024 Elections

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On October 31, a constitutional bench of five Supreme Court judges, featuring Chief Justice DY Chandrachud, Justice Sanjiv Khanna, Justice BR Gawali, Justice JB Pardiwala, and Justice Manoj Mishra, began the long-anticipated hearing on the Electoral Bonds case. This case, pending in the Supreme Court for eight years, is set to have significant ramifications for the forthcoming Lok Sabha elections in 2024. The case comes after the central government’s statement on October 30, asserting that voters do not have the right to discover the sources of funding for political parties.

Understanding Electoral Bonds

Electoral bonds serve as a conduit for individuals, institutions, or companies to make anonymous donations to political parties. These bonds come in varying denominations, including Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh, and Rs 1 crore, and can be obtained from designated branches of the State Bank of India (SBI). The anonymity of the purchaser is preserved. Launched in 2017, the purpose of electoral bonds is to enhance transparency in political party donations and has been in use since 2018.

When a political party receives electoral bonds, they must be encashed within 15 days. The dates for purchasing these bonds are fixed, allowing transactions only between the 1st and 10th of January, April, July, and October. In election years, an additional 30-day window is provided for bond purchases. It is essential to note that donations through these bonds are only permitted for registered political parties as defined under Section 29 of the Representation of the People Act, 1951. A political party must secure at least 1 percent of the total votes cast in Lok Sabha or state assembly elections to qualify for registration, as reported by the Indian Express.

The Controversy Surrounding Electoral Bonds

Opponents argue that electoral bonds compromise transparency in the electoral process since the identity of donors is not disclosed to the public or the Election Commission, making it challenging to trace the source of funding. Another concern is the potential for illegal money to infiltrate the political system through electoral bonds. While the scheme’s intent was to allow ordinary citizens to contribute to political parties, it has been observed that a significant majority of donations come in the form of the highest-value bonds, priced at Rs 1 crore. Reports indicate that political parties have received a total of Rs 13,000 crore in donations through electoral bonds between March 2018 and July 2023.

Opposition Parties’ Stance

The Communist Party of India (M) challenged the electoral bonds scheme in the Supreme Court in 2018, asserting that it poses a threat to democracy and encourages corruption. They have called for the scheme’s cancellation. According to the Indian Express, the Congress party has rejected the central government’s argument that the electoral bonds scheme represents a significant step in electoral reform. Opposition parties also object to the scheme because it has resulted in the BJP receiving three times more donations than any other party. Previously, there was a restriction that limited a company’s political donations to 7.5 percent of its three-year profits, but this limitation was eliminated by the BJP government.

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Supreme Court Commences Hearing on Electoral Bonds Case with High Stakes for 2024 Elections
Supreme Court Commences Hearing on Electoral Bonds Case with High Stakes for 2024 Elections
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