NGO Moves SC Challenging Electoral Bonds Scheme Ahead of Bihar Assembly Polls

New Delhi, Oct 27 (PTI) Ahead of Bihar Assembly elections, an NGO has moved the Supreme Court seeking urgent hearing of its 2017 PIL challenging the 2018 Electoral Bonds Scheme meant for funding political parties.

The NGO, Association for Democratic Reforms, had earlier also moved a similar plea seeking stay on the scheme ahead of Delhi Assembly polls in January this year. The apex court had refused to grant the interim stay on the scheme.

The top court, however, had sought response of the Centre and the Election Commission within two weeks on the interim application filed by the NGO on January 20 and since then the PIL has not been listed for hearing.

The three-phase elections in Bihar will be held from October 28 to November 7 amid the COVID-19 pandemic; the counting of votes will be on November, 10.

“Right before the Bihar legislative assembly elections, the State Bank of India, in the XIV Phase of sale, has been authorized to issue and encash Electoral Bonds through its 29 Authorized branches with effect from October 19 to October 28, 2020,” said the fresh plea, filed through lawyer Prashant Bhushan.

Seeking urgent hearing, it said even though a notification of January 2, 2018, stipulated the sale of electoral bonds in months of January, April, July and October months of each year and the “window was not opened in April and July, but has been opened in October, (this year) right before the Bihar legislative election.”

It said in view of passing of more than nine months since the last date of hearing of the PIL and new developments relating to Bihar legislative election having taken place, the instant plea required an urgent hearing.

As the reason for urgency, the NGO said that it had filed the PIL on September 4, 2017 on the issue of corruption and subversion of democracy through illicit and foreign funding of political parties and lack of transparency in the accounts of all political parties.

“Certain amendments made through Finance Act, 2017 and earlier Finance Act, 2016, both passed as money bills, and which have opened doors to unlimited political donations, even from foreign companies and thereby legitimising electoral corruption at a huge scale, while at the same time ensuring complete non-transparency in political funding,” it said.

The scheme has opened the floodgates to unlimited corporate donations to political parties and anonymous financing by Indian as well as foreign companies” which can have serious repercussions on the Indian democracy,” it said.

“The Finance Act of 2017 has introduced the use of electoral bonds which is exempt from disclosure under the Representation of Peoples Act, 1951, opening doors to unchecked, unknown funding to political parties,” it said.

The amendments to the law have removed the existing cap of 7.5% of net profit in the last three years on campaign donations by companies and have legalised anonymous donations, it said.

Earlier, the apex court had refused to grant interim stay on the 2018 Electoral Bonds Scheme ahead of Delhi Assembly polls.

The poll panel filed its reply in February and had told the top court that it has received status of filing of electoral bonds from various political parties, including the Bharatiya Janata Party and the Congress, in a sealed cover.

The EC had filed the affidavit in pursuance to the top court's direction asking the political parties to furnish all details of funds received through electoral bonds to the poll panel in a sealed cover.

The government had notified the Electoral Bond Scheme on January 2, 2018.

As per provisions of the scheme, electoral bonds may be purchased by a person, who is a citizen of India or incorporated or established in India.

An individual can buy electoral bonds, either singly or jointly with other individuals.

Only political parties registered under Section 29A of the Representation of the People Act, 1951 and which secured not less than 1% of votes polled in the last general election to the House of the People or the Legislative Assembly of the State, are eligible to receive electoral bonds.

As per the notification, electoral bonds shall be encashed by an eligible political party only through a bank account with an authorised bank.