Electoral bonds verdict updates | Supreme Court declares electoral bonds scheme unconstitutional

Electoral bonds case | Supreme Court upholds right to keep political affiliations private from State intrusion, indirect influences

Supreme Court verdict on electoral bonds: The top court rules that the right to privacy includes political affiliations, protecting against misuse and suppression.

“Forming political beliefs and opinions is the first stage of political expression. Political expression cannot be exercised freely in the absence of privacy,” Chief Justice Chandrachud observed. He added that a lack of privacy about political affiliations would “disproportionately affect” people whose views do not match with that of the mainstream.

Electoral bonds scheme verdict | Anonymity in scheme was ‘selective’, not ‘fool-proof’: Supreme Court

Electoral Bonds verdict: Supreme Court concludes that electoral bonds do not provide fool-proof anonymity, allowing political parties to know contributors' identities.

“While it is true that the law prescribes anonymity as a central characteristic of electoral bonds, the de jure anonymity of the contributors does not translate to de facto anonymity,” a Constitution Bench headed by Chief Justice of India D.Y. Chandrachud observed in its judgment quashing the electoral bonds scheme.

Welcoming the Supreme Court’s landmark judgment annulling the electoral bonds scheme, the Trinamool Congress said people have the right to know the source of funding of political parties.

Without naming any political outfit, Trinamool spokesperson Kunal Ghosh said the verdict was a blow to the party which introduced the bonds in the country.

“People have the right to know the source of funding of political parties. We welcome the Supreme Court judgment,” Ghosh told reporters here. He claimed that the TMC has always been in favour of transparency. - PTI

The Rashtriya Janata Dal (RJD), the main opposition party in Bihar, welcomed the verdict of the Supreme Court striking down the Electoral Bonds Scheme and said the judgement will strengthen democracy.

The scheme had been brought to benefit the ruling BJP at the Centre from anonymous donors, the RJD’s state spokesperson Mrityunjay Tiwary said.

“We welcome this historic verdict of the SC. It will strengthen democracy and increase people’s faith in the system. The judgement will also ensure that the electoral funding process becomes transparent,” he said. - PTI

Welcoming the Supreme Court judgment striking down electoral bonds, the CPI(M), the only political party among the petitioners in the case, said it was an “unscrupulous scheme designed to help the ruling party” and it was now essential to introduce reforms for political and electoral funding.

“The Polit Bureau of the CPI(M) hails the historic judgment of the Supreme Court, which has struck down the electoral bonds scheme as unconstitutional. By this verdict, this unscrupulous scheme designed to finance the ruling party by anonymous corporate donors has been completely scrapped,” the party said in a statement.

The party had declared at the outset itself that it would not accept electoral bonds as this scheme legalises corruption, the statement read, adding that the CPI(M) had challenged the electoral bonds scheme in the Supreme Court along with other petitioners.

In a post on X, CPI(M) general secretary Sitaram Yechury said he was glad that the unanimous verdict has upheld the party’s contention.

Mr. Yechury said the CPI(M) was the only political party that did not accept electoral bonds, and called it “legalisation of corruption”. - PTI

CPI(M-L) Liberation general secretary Dipankar Bhattacharya hailed the Supreme Court’s decision to strike down the Electoral Bond Scheme, describing it as “anti-democratic and unconstitutional.”

The CPI also welcomed the apex court verdict.

A statement by Ram Naresh Pandey, state secretary (Bihar), CPI, said, “This decision of the SC will strengthen the democratic system in the country. Electoral bonds are against the democratic system of the country”. - PTI

BJP leader Ravi Shankar Prasad says that his party “respects” the Supreme Court verdict on electoral bonds. 

“Electoral bonds had laudable objective of bringing transparency in electoral funding,” he says.

Welcoming the Supreme Court’s verdict on electoral bonds, AIADMK general secretary Edappadi K. Palaniswami said his party was the only party that did not receive funds through the scheme. 

Speaking to reporters outside the Assembly House, Mr. Palaniswami called upon the media to expose all those parties that received hefty sums through the electoral bonds.

“It’s a pretty huge sum raised through bonds... those parties are suppressing us and trying to destroy us with their money power. Definitely we welcome it,” he said. - PTI

Tamil Nadu Chief Minister M. K. Stalin welcomed the Supreme Court order striking down the electoral bonds scheme as unconstitutional. 

Former Chief Election Commissioner T. S. Krishnamurthy termed as “historic” the Supreme Court verdict annulling the electoral bonds scheme for political funding, and said it’s in the interest of a clean democracy. Mr. Krishnamurthy said he entirely agreed with the judgment, noting that he had made public statements in the past that the electoral bonds scheme is not right for transparency in political funding.

He said, “In fact, the scheme is not at all the right method, though it was claimed that it is promoting transparency because it goes through the banking channel. But the origin of the funding and name of the donor are not known. And how do you know if it’s clean money or dirty money; it’s not known.” 

“It is a historic judgment, it’s in the interest of a clean democracy. I only hope that the political parties will learn their lessons,” Mr. Krishnamurthy said. - PTI

CPI(M) Rajya Sabha MP and senior advocate Bikash Ranjan Bhattacharya said it will also help people to have their independent opinion while polling, being uninfluenced by money power.

“This judgement is one of the important verdicts to protect the Indian Parliamentary democracy from the influence of anonymous contributions,” Mr. Bhattacharya said.

Mr. Bhattacharya said that it would have been more welcome if the apex court directed the refund of all the money received by different political parties to the donors since the introduction of the electoral bonds scheme in 2018.

Asked whether the landmark judgement will have any impact on the coming Lok Sabha elections, he said, “This will be a great blow to those political parties who had to depend a lot on such undisclosed funds. - PTI

Party spokesperson Pawan Khera said at a press conference in New Delhi that the Congress has been fighting this battle for the last seven years both within Parliament and outside and its stand has been vindicated. “We welcome the judgment of the Hon’ble Supreme Court,” he told reporters.

“We are grateful to the Supreme Court of India. We, as a nation, stand strengthened and encouraged,” Mr. Khera said and added that, “Today, we stand vindicated”.

Mr. Khera charged that the electoral bonds were “a wilful tool of concealment, of absolute exoneration from political accountability”. “That was their only purpose and all the intellectualisations offered at the time have failed to withstand judicial scrutiny,” he noted. - PTI

On the Supreme Court verdict of the electoral bonds, former Congress president Rahul Gandhi said, “Another proof of Narendra Modi’s corrupt policies is in front of you. The BJP had made electoral bonds a medium for taking bribe and commission. Today a stamp has been put on this.” - PTI

The Congress welcomed the Supreme Court verdict striking down the electoral bonds scheme, and said that it will reinforce the power of votes over notes.

The Opposition party also said that it hopes that the Modi government will stop resorting to such “mischievous ideas” in the future and listen to the Supreme Court so that democracy, transparency and level-playing field persist.

In a post on X, Congress president Mallikarjun Kharge welcomed the Supreme Court decision and hoped the government will stop resorting to “such mischievous ideas” in the future.

He said the Congress had called the scheme “opaque and undemocratic” when it was launched. - PTI

Welcoming the Supreme Court judgment striking down electoral bonds, the CPI(M) said it was an “unscrupulous scheme designed to help the ruling party” and it was now essential to introduce reforms for political and electoral funding.

“It is gratifying that the main contentions set out in the petition against the scheme have been upheld. It is essential now that reforms for political and electoral funding are introduced to ensure transparency, clean funding and a level playing field,” the party said.

In a post on X, CPI(M) general secretary Sitaram Yechury added that he was glad that the unanimous verdict has upheld the party’s contention. “Congratulations to our Counsel Shadan Farasat and others who effectively argued the case,” Mr. Yechury said. - PTI

The Aam Aadmi Party welcomed the Supreme Court’s decision on electoral bonds, saying it is an important step in ensuring transparency in election funding.

“We welcome this decision. This is an important step in the transparency of election funding. Otherwise through electoral bonds, it was not known which person was giving funds to which party. It is important for country’s democracy that it is known which person is giving how much money to which political party,” Delhi Cabinet minister Atishi told reporters outside the Assembly. - PTI

The Sharad Pawar-led NCP faction said the Supreme Court’s decision to strike down the electoral bonds scheme is a welcome move and there should be transparency and accountability of every donation that comes to a political party.

NCP-Sharadchandra Pawar spokesperson Clyde Crasto claimed the electoral bonds scheme was brought to practice to benefit the ruling Bharatiya Janata Party from anonymous donors and BJP is the only party that has benefited from it since it was implemented.

This scheme cannot rule out the possibility of a ‘quid pro quo’ from an individual or a company to a political party and therefore seeing the quantum of electoral bonds received by the BJP, this is a possibility, he added.

“The Supreme Court’s decision to strike down the electoral bonds scheme, calling it “unconstitutional”, is a very welcome move. There should be transparency and accountability of every donation that comes to a political party,” Mr. Crasto said. — PTI

Rajya Sabha MP Kapil Sibal called SC’s decision “a ray of hope for democracy”. Mr. Sibal reacted to the SC verdict calling Electoral Bonds scheme as the “brainchild” of late BJP leader Arun Jaitley.

“This is a huge ray of hope not just for a, b or c political party but for democracy itself. It’s a huge ray of hope for the citizens of this country,” said Mr. Sibal. 

“This whole scheme which was the brainchild of my late friend Arun Jaitley, which was in fact choreographed to enrich the BJP. Because everybody knew that the BJP was in power and that any donations through the electoral bond scheme would come to the BJP,” added Mr. Sibal.

“But the interesting part is that this electoral bond scheme had nothing to do with elections. It was really the bonding between the corporate sector and the BJP which received the largest number of donations, and the donations they received over the years amounted to about five to 6000 cores,” said Mr. Sibal.

“Now with 5,000 to 6,000 cores in your kitty which is not to be used in elections at all. You can build your infrastructure as a political party. You can build the infrastructure for the RSS. You can set up your communication network throughout the country,” added Mr. Sibal. — PTI

The Supreme Court verdict striking down the electoral bonds scheme is a “great boon for democracy”, former chief election commissioner S Y Quraishi said. 

“This will restore people’s faith in democracy. This is the greatest thing that could have happened. This is the most historic judgement that we have got from the Supreme Court in the last five-seven years. It is a great boon for democracy,” Quraishi told PTI Videos..

“We were all concerned for the last so many years. Everyone who loves democracy was protesting about it. I myself wrote several articles, spoke to the media many times. And every issue that we raised has been tackled in the judgment,” he said.

Advocate Varun Thakur, who represented Jaya Thakur in the case, described the ruling as a historical step for democracy.

“This is a major setback for the government because the SC has directed to disclose all transactions between 2019-24. It has also directed the SBI to submit a full report to the Election Commission. And it has also directed the Election Commission to disclose that report within a week.

“So this is a very big setback... the way donations were being taken off the record. Now accountability will be fixed: whether policies have been formed to favour those who have donated. The public have the right to know this... We can say that democracy has won today.” 

The Supreme Court’s decision to strike down the electoral bond scheme will help bring in transparency in political funding and protect the interest of people, Congress leader Jaya Thakur, who had challenged the scheme in the apex court, told PTI. 

The Supreme Court’s decision to strike down the electoral bond scheme will help bring in transparency in political funding and protect the interest of people, Congress leader Jaya Thakur, who had challenged the scheme in the apex court, said 

“We opposed Electoral Bonds from the very beginning and never accepted funding through Electoral Bonds. We are ideologically against corporate influence in elections,” says the Communist Party of India.

The Congress has welcomed the Supreme Court verdict striking down the electoral bond scheme, and said it will reinforce the power of votes over notes.

In a post on X, Congress general secretary Jairam Ramesh said, “The Supreme Court has held the much-touted Electoral Bonds scheme of the Modi Sarkar as violative of both laws passed by Parliament as well as the Constitution of India.” 

Responding to the SC verdict, advocate Shadan Farasat said, “Supreme Court has unanimously struck down the electoral bond amendments. The amendments that were the basis of the scheme have been struck down from different enactments like the Income Tax Act and others.”

“Supreme Court agreed with our submissions. The amendments which were introduced to ensure the anonymity of the scheme have been struck down and based on that, consequently, the scheme itself has been struck down,” he added.

Senior advocate Prashant Bhushan said that the petitions filed have been comprehensively allowed by the Supreme Court.

Speaking on the SC verdict, the senior lawyer said, “The Supreme Court has struck down the electoral bond scheme, comprehensively struck it down, and all the provisions that were made to bring it into effect in the Income Tax Act, in the Companies Act, etc. Everything has been struck down.”

“They have held that this violates the fundamental right to information of citizens to know about who is contributing this much money to political parties, et cetera. They have also struck down the amendment made, which allowed unlimited political contribution being made by companies to political parties,” he added.

“So not only the electoral bond scheme but also the amendment which removed the restrictions on political contributions by companies, which were that you cannot contribute more than seven and a half per cent of your annual profit by way of political contributions. That has also been struck down as violating the level playing field in a democracy. So the petitions filed by us have been comprehensively allowed by the Supreme Court,” Mr. Prashant Bhushan said.

“ I agree with the judgment of the CJI. I have also applied the principles of proportionality but with a slight variation. But the conclusions are the same”, Justice Sanjiv Khanna says. 

The court directs SBI to furnish the details of electoral bonds encashed by the political parties to the Election Commission of India (ECI). 

The ECI will publish such details on the website by March 31, 2024.

“The issuing bank shall forthwith stop the issue of electoral bonds. The State Bank of India shall furnish the details of donations through electoral bonds and the details of the political parties which received the contributions”, the court orders. 

1. Electoral bonds scheme is violative of Article 19(1)(a) and unconstitutional.

2. The amendments to the Companies Act are unconstitutional.

“A company has more graver influence on the political process than contributions by individuals. Contributions by companies are purely business transactions. Amendment to Section 182 Companies Act is manifestly arbitrary for treating companies and individuals alike”, the CJI adds. 

The court further ruled that the amendment to the Companies Act which allows blanket corporate political funding is unconstitutional. 

Amendments made to the Income Tax Act provision and Section 29C of the Representation of Peoples Act are declared to be ultra vires: CJI Chandrachud 

The CJI further says that the right to privacy of political affiliation does not extend to contributions made to influence public policy and applies only to contributions below the threshold. 

“Not all political contributions are made with the intent to alter public policy. Students, daily wagers, etc also contribute. To not grant an umbrella of privacy to political contributions only because some contributions are made for other purposes is not impermissible”: CJI Chandrachud 

The CJI says that the infringement of the right to information is not justified by the purpose of curbing black money and that informational privacy applies to political contributions too.

CJI Chandrachud further elucidates that financial support to political parties can lead to a quid pro quo arrangement. He points out that the electoral bonds scheme is not the only scheme to curb black money as there are other alternatives.

The court rules that anonymous electoral bonds are violative of the right to information and Article 19(1)(a) of the Constitution. 

“Political parties are relevant units in the electoral process. Information about the funding of political parties is essential for electoral choices”: CJI Chandrachud 

CJI Chandrachud says – “The courts have held that citizens have the right to hold the government to account. The crucial aspect of the expansion of the right to information is that it is not confined to state affairs but also includes information necessary for participatory democracy.” 

The CJI reads out the verdict. He says that the following issues have been raised in the petitions – 

(a) Whether amendments are violative of the right to information under Article 19(1)(a)? 

(b) Whether unlimited corporate funding violate the principles of free and fair elections? 

CJI Chandrachud says that the bench has arrived at a unanimous verdict. There are two concurring opinions of the court. One authored by CJI D.Y. Chandrachud and the other by Justice Sanjiv Khanna. There is however a slight variance in the reasoning.

A five-judge Constitution Bench comprising Chief Justice of India (CJI) DY Chandrachud and Justices Sanjiv Khanna, BR Gavai, JB Pardiwala, and Manoj Misra will deliver the verdict at 10:30 am today. The proceedings can be watched here–

Share of income from unknown sources to national parties was lower at 66% in the two years before the scheme compared to the 72% afterwards. 

Read The Hindu’s report here. 

 Parties’ unknown income rise despite electoral bonds | Data

AG submits electoral bonds promote “clean money” to SC; Bench raises possibility of influential entities buying bonds through verified accounts; ADR data shows share of unknown sources of income has increased post scheme's introduction; BJP cornered 57% of income from bonds; unknown income shifted from <₹20K donations & coupon sales to bonds.

With the constitutionality of electoral bonds being contested more strongly, the citizen must push for a more level-playing field in the next round of elections. Read more here. 

As per an affidavit filed in the Supreme Court last year, the BJP has received over Rs. 5,271 crores as donations through electoral bonds, so far (Rs. 5271,97,58,000), while the Congress has received over Rs. 952 crores (Rs. 952,29,56,000).

Among regional parties, Biju Janata Dal received over Rs 622 crores, while YSR Congress got over Rs. 330 crores (Rs. 330,44,00,000).

The ruling BJP received nearly ₹1,300 crore through electoral bonds in the 2022-23, which was seven times more than what the Congress got in the same period through the same route. 

Read more here. 

The ruling party’s total income rose to ₹2,361 crore in 2022-23 from ₹1,917 crore in 2021-22, according to the annual audit report of the BJP made public by the Election Commission. Read more here. 

54% of BJP’s total income came from electoral bonds

The BJP received ₹1,294.14 crore through electoral bonds, accounting for 54% of its income, while the Congress received significantly less.

A Constitution Bench on October 31 raised the scenario of influential entities covertly setting up persons with verified accounts to purchase electoral bonds for them through the regular banking route in order to curry favour or anonymously enter into a quid pro quo with ruling political parties.

Read more here.

In an affidavit filed before the Supreme Court in 2019, the ECI said that electoral bonds would wreck transparency in political funding and invite foreign corporate powers to impact Indian politics.

Here is The Hindu’s detailed explainer on the reservations expressed by the ECI and the RBI against the scheme.