WHAT WERE ELECTORAL BONDS?
Electoral bonds were a method to make donations to the political party of your choice. These bonds were available in the denominations of ₹1,000 ₹10,000 ₹1,00,000 ₹10,00,000 and ₹1,00,00,000 and it did not carry the name of the purchaser or the recipient. This scheme was introduced in the financial bill, 2017 during Union Budget 2017-18.
The supreme court struck this scheme down on 15th February, 2024.
THE JUDGEMENT
A Five judge bench of the supreme court of India headed by CJI DY Chandrachud unanimously struck down the electoral bonds scheme terming it ‘unconstitutional’. It re instilled the dear faith in judiciary as it was successful in upholding the principles of transparency and accountability in the electoral process.
Amendments to section 29C of Representation of people Act,
This provision was amended as it earlier stipulated the treasurer of a political party or any other person authorized by the political party in each financial year to prepare a report in respect of the contributions in excess of twenty thousand rupees received by the party from a person or company other than Government companies in that financial year. After the amendments brought by the Financial Act 2017, a proviso was added because of which, a political party would not be stipulated to disclose the amount of contribution made by electoral bonds.
Amendment to the section 13A of the IT Act,
It removed the earlier mandate to maintain a record of contributions if the contribution was received by electoral bonds.
Amendment to the section 182(1) and 182(3) of the Companies Act,
The amendment to section 182(1) omitted the previous cap on corporate entities which earlier stipulated them to not donate in excess of 7.5% of their average net profit.
The amendment to section 182 (3) required to only disclose the total amount donated to a political party by a company and removing the stipulation to disclose the fundings made to particular political parties.
THE CONCLUSION
The above amendments facilitated the central government to have an upper hand in the electoral processes. Particularly, the judgement stated that IT Act and RP Act denied the citizens their right to information, thus violating section 19 (1) (A) of the constitution. Furthermore, the court reasoned that omitting corporate entities from the cap as was mentioned in Company Act could put the entity (which could also be a loss-making company) in a position to influence the government to make policies which are arbitrarily beneficial to that particular entity and would thus, negate the value of “one person, one vote”.