The clear message in the Court’s ‘no’ to electoral bonds

Context:

The Supreme Court of India's recent ruling on February 15, 2024, striking down the electoral bonds scheme marks a significant moment in upholding transparency and democracy in the country's electoral process.

Funding limits removed:

Transparency Concerns: The electoral bonds scheme lacked transparency, denying voters knowledge of political party funding sources and amounts contributed, contrary to established practices in leading democracies.
Influence of Corporate Funding: The judgment highlights concerns regarding corporate funding's potential to unduly influence the political process and legislative decisions, emphasizing the need for limits on corporate contributions to prevent such influence.
Risk of Shell Companies: Electoral bonds removed previous limits on corporate donations and allowed even loss-making companies to contribute, raising the risk of shell companies being used to channel funds to political parties, a concern acknowledged by the Election Commission of India.

A well thought-out plan:

Legislative Amendments: The introduction of the electoral bonds scheme involved amendments to several laws, including the RBI Act, the Representation of the People Act, the Income Tax Act, and the Companies Act, bypassing transparency requirements mandated by the Central Information Commission.
Lack of Public Consultation: The scheme's implementation bypassed processes for public consultation and parliamentary discussions, raising questions about democratic decision-making and transparency in legislative processes.
Violation of Fundamental Rights: The Supreme Court's judgment emphasizes violations of Articles 19 and 14 of the Constitution, safeguarding the right to information and equality, respectively, highlighting the scheme's arbitrariness and constitutional inconsistencies.

The essence of the judgment:

Striking Down of Electoral Bonds Scheme: The Supreme Court has invalidated the electoral bonds scheme and declared associated amendments to various acts as violative of fundamental rights enshrined in the Constitution.
Directives to State Bank of India (SBI) and Election Commission of India (ECI): The SBI, the sole issuer of electoral bonds, is directed to cease issuance and provide detailed information on all previously issued bonds to the ECI by March 6, 2024, for public disclosure on the ECI's website.
Upholding Democracy: The judgment underscores the importance of judicial review in safeguarding democracy and applauds the role of constitutional bodies like the ECI and the Supreme Court in upholding democratic principles.

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