Supreme Court Strikes Down Electoral Bonds Scheme

 

The Supreme Court unanimously declared the electoral bonds scheme unconstitutional for violating the right to information of voters. The court held that the scheme's anonymity feature hinders the public's right to know about political funding, which is essential for a transparent democracy. The judgment highlighted the unrestrained influence of corporations in the electoral process due to the scheme's provisions, which was deemed violative of free and fair elections. The court also struck down the amendments made to the Income Tax Act and the Representation of People Act, which enabled anonymous political contributions. The State Bank of India, which issues the electoral bonds, was directed to stop the scheme immediately and reveal the details of donations through electoral bonds.

Electoral bonds provided complete anonymity to both the donor and the recipient, with no details of the transaction being made public. The scheme was introduced through amendments to the Finance Act, 2016, and allowed for the issuance of bearer instruments for political donations. The State Bank of India was the sole authorized bank to issue these bonds, which were available in specific denominations for political contributions.

The Supreme Court's ruling declared the electoral bonds scheme and the related legal amendments as 'unconstitutional and manifestly arbitrary'. The court emphasized that the scheme's anonymity feature violated the voters' right to information under Article 19(1)(a) of the Constitution. The court specifically struck down the amendments to the Income Tax Act and the Representation of People Act that enabled anonymous political contributions.

The judgment highlighted the concern over unlimited corporate funding to political parties, which was seen as a threat to the democratic process. The verdict was seen as a move towards creating a more level playing field for political parties by reducing the influence of large corporate donations. The decision was lauded for empowering voters with the right to information, allowing for more informed political decisions.

The court's decision included a directive for the State Bank of India to disclose the details of donations made through electoral bonds. The ruling may lead to further legal reforms in political funding to ensure transparency and accountability. There is likely to be an assessment of the impact of the judgment on future political finance mechanisms.