Political Parties have to provide full information on each donor/contributor of electoral bonds - Seeker's Thoughts

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Friday, 12 April 2019

Political Parties have to provide full information on each donor/contributor of electoral bonds


Political Parties have to follow the interim order given by Supreme Court

The Supreme Court on 12th April 2019 passed interim directions, directing political parties to provide full information on each and every political donor and contributions made through electoral bonds in sealed cover to the Election Commission of India (ECI).


Elections are costly 

The cost of elections and campaign remain in thousands of crores, and there were different occasions when transparency of electoral funding came into lime light.
Since 2016, the government strived to take this issue at serious note and brought Finance Act 2016, and 2017. 


Therefore, electoral bonds were introduced with the intention of keeping the funding of political parties transparent during elections.

The reality of the world when it comes to election is bitter. The democratic will has less voice among the crowd who is less educated, and uninterested in Politics.
 
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The black money is often used in elections, and it breaks the soul of the democracy.  When elections are manipulated in different ways, as through illegal flow of cash- the money is distributed to buy votes, and alcohol is also distributing at some place.

 Election commission works but the population is large, and everywhere everything does not come at surface. There has been a series of events and decisions to prevent illegal flow of money during elections. One among them is – the scheme of electoral bonds. 


Foreign corporate powers can interfere, the poll panel tells Supreme Court in the end of March 2019

The Election Commission of India (ECI) has told the Supreme Court that electoral bonds, contrary to government claims, wreck transparency in political funding.

Coupled with the removal of cap on foreign funding, they invite foreign corporate powers to impact Indian politics, it said in an affidavit filed in the apex court.

Besides detailing how donations received through electoral bonds would cause a “serious impact” on transparency in funding of political parties, The ECI ripped apart amendments made to various key statutes through the two consecutive Finance Acts of 2016 and 2017.

These amendments would pump in black money for political funding through shell companies and allow unchecked foreign funding.


What are electoral bonds?

Electoral bonds are different type of bearer bond- that means a debt instrument. In simple words earlier political parties used to ask for donations, which attracted huge amount of black money. Political parties have to issue these bonds- and people who want to do charity, now can purchase a bond.


As per provisions of the Scheme, electoral bonds may be purchased by a citizen of India, or entities incorporated or established in India. 

A person being an individual can buy electoral bonds, either singly or jointly with other individuals. Only the registered Political Parties which have secured not less than one per cent of the votes polled in the last Lok Sabha elections or the State Legislative Assembly are eligible to receive the Electoral Bonds.

The electoral bonds are aimed at rooting out the current system of largely anonymous cash donations made to political parties which lead to the generation of black money in the economy.



The Apple of Discard since the beginning 

The conflict remains as electoral bonds have been introduced but no records are kept of the owner or the transactions involving ownership. Anyone who holds them physically holds mere papers. A donor does not need the identity and political party would not be required by law to ask questions. 


These can be bought for any value, in multiples of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh or Rs 1 crore.

The Finance Act of 2017 amends various laws, including the Representation of the People Act of 1951, the Income Tax Act and the Companies Act.
It did allow political parties ‘to skip’ recordings of donations received by them through electoral bonds in their contribution as amendment allowed the ‘anonymous donations’.
Donors of the political parties are not required to provide their names, address or PAN if they have contributed less than Rs 20,000.
Therefore, the election commission observed that many political parties showed maximum donation received less than the prescribed limit of 20,000.
In 2016, the finance act opened the door for donations to be received from foreign companies.


 Why should citizen be aware and care about it?

The political parties receive enormous amount of cash flow and these donations are often given by a group of super rich individuals and that gives these rich individuals a control over politics.
  
According to ADR report released in August revealed that between the financial year 2012-13 to 2015-16, national parties received Rs 355.08 crore from 1,546 donations which did not have addresses and PAN details in the contribution form. 99% of such donations belonged to the powerful national party. EB acts as a catalyst for such anonymity and corruption. 

Former Election Commissioner SY Quraishi suggested an alternative to electoral bonds – a National Electoral Fund where donors can contribute and the accumulated fund would be allocated to political parties depending on the proportion of votes secured.


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