The Supreme Court of India declared the Electoral Bond Scheme unconstitutional in a landmark judgment on February 15, 2024.
The Electoral Bond Scheme, introduced by the government in 2018, allowed individuals and corporations to anonymously fund political parties by purchasing electoral bonds from the SBI. The records of the funds was to be available only with the SBI.
The Supreme Court of India struck down the Electoral Bond Scheme for several compelling reasons:
1. Anonymity Violation: The court held that the anonymity of donors in electoral bonds violated the Right to Information under Article 19 (1) (a) of the Constitution. This fundamental right ensures that citizens have access to information, including the identity of those contributing to political parties.
2. Transparency and Accountability: The court emphasized the importance of transparency and accountability in the electoral process. By allowing anonymous donations, the scheme hindered the public’s ability to scrutinize political funding effectively.
3. Risk of Illicit Funding: Anonymity could potentially facilitate illicit funding, allowing vested interests to influence political parties without proper oversight. The court recognized this risk and sought to address it by striking down the scheme.
4. Democratic Principles: Upholding democratic principles, the court asserted that citizens have a right to know who financially supports political parties. Transparency fosters trust and ensures that political decisions are not unduly influenced by hidden interests.
5. Balance of Interests: While acknowledging the need for political funding, the court weighed it against the larger public interest. It concluded that the scheme’s anonymity provisions tipped the balance unfavorably.
6. Constitutional Validity: The court evaluated the scheme’s compatibility with constitutional principles, including the right to equality, free speech, and the integrity of the electoral process. Finding it wanting, the court declared it unconstitutional.
In summary, the Supreme Court’s decision aimed to enhance transparency, protect democratic values, and prevent potential misuse of political funding through the Electoral Bond Scheme .
The Apex Court also issued the following directions:
1. Anonymity Violation: The court held that the anonymity of donors in electoral bonds violates the Right to Information under Article 19 (1) (a) of the Constitution. This means that citizens have the right to know the identity of those contributing to political parties.
2. Scheme Struck Down: The Supreme Court ordered the State Bank of India (SBI) to stop issuing new electoral bonds. Additionally, the SBI was instructed to furnish details of all electoral bonds encashed by political parties.
3. Publication of Donors’ Names: As a result of the court’s ruling, the Election Commission (EC) will now publish the names of donors who purchased electoral bonds. The details to be made public include:
- Date of purchase of each electoral bond.
- Name of the purchaser.
- Denomination of each electoral bond.
- Details of every electoral bond encashed by political parties, including the date and denomination of encashment, starting from April 12, 2019.
4. Previous Disclosure: Electoral bonds sold and encashed before April 12, 2019, were already provided to the EC in a sealed cover earlier, as per the court’s interim order in 2019. The court has now directed the poll panel to publish this data on its website as well.
