The electoral bonds scheme: The scheme was introduced in 2017 by the then Finance Minister Sh. Arun Jaitley. These were introduced through The Finance Bill 2017-18 and were classified as a Money Bill, Thus exempted from the compulsory requirement of being passed in the Upper House ( Rajya Sabha).

The Finance Minister also proposed to amend the RBI Act for the issue of electoral bonds and their political funding.

It allowed industries, corporate groups, and individuals to fund and donate money to any political party. The amount may be any or unlimited amount and it is done anonymously i.e. the name and identity of the individual or corporate group will not be disclosed with anyone not even with The Election Commission of India.

Features

·        Interest-free, Promissory Note.

·        Donations from individuals and corporate groups.

·        Anonymity.

·        Redeemed within 15 days of issuance.

What if the 15-day deadline (to redeem the electoral bond) is not met?

The main feature of these electoral bonds is that they can be redeemed within 15 days of their issuance.

If the 15-day deadline (to redeem the electoral bond) is over then neither the Donor nor the Political party gets the refund, in that case, the amount automatically goes to the Prime Minister Relief Fund.

Which Political Party is eligible to receive the Electoral bond?

• Those political parties registered under Section 29A of the Representation of the People Act 1951.
• Political parties which secured not less than 1% of the votes polled in the previous General election to Lok Sabha or the Legislative Assembly of the state.

If all the above conditions are met then those political parties are eligible to receive the electoral bond.

From where these bonds are issued and encashed?

• These bonds are issued and encashed through the State Bank of India only. No other bank other than SBI can issue these bonds.
• Even they are not available in all the branches of the State Bank of India but only in authorized branches.
• These are available for purchase for a period of 10 days in January, April, July, and October each
• The additional 30-day period in general election year.

What is the minimum value to purchase/issue the electoral bond?

Any value in the multiples of ₹1000, ₹10000, ₹100000, ₹1000000, ₹10000000.

Issue related to the Electoral Bonds.

The issue was raised since they were introduced by the government of India. The PIL was filed by the Association of Democratic Reforms (ADR). The ADR proposes that the election bond scheme should be entirely scrapped.

Some of the points raised by ADR are:

·        Violation of the Right to Information, Which is a fundamental right under Article 19(1)(a).

·        Introduction of the electoral bond as a money bill, surpassing the upper house's role to discuss it.

·        Permitting unlimited contributions by corporate groups. This may also include shell companies, due to this the corporate groups through their funding can influence the principle of a free and fair electoral process.

If fundamental rights are violated then the PIL was filed under Article 32.

The Supreme Court Findings.

• Taking the issue as important the five-judge bench looked into the matter and started the hearing into the matter.
• The arguments of both sides that is the union of India and ADR were heard and the top court came with an important decision that the issue is not just the violation of fundamental rights but also the balance of the fundamental rights.
• The balance of the right to information which comes under Article 19(1)(a) and the right to privacy which comes under Article 21.
• The Anonymity clause introduced by the government of India is also violating the right to equality.

Decisions by the Supreme Court.

Now here comes the landmark judgment of the five-judge bench of the Supreme Court. The Supreme Court in its judgment directed the electoral bond scheme as unconstitutional and it is null and void. This decision of the top court was a landmark decision on 15 Feb. 2024.

The Judgement also directed the State Bank Of India to provide the details of the Electoral bond data to the Election Commission of India.

The data must be from 2019 to till date.

The Election Commission of India is directed to publish the same date on its website by 15 March 2024.

Result of the Judgement.

The result of the judgment is very clear that the State Bank of India and The Election Commission of India have to act accordingly and they did so even before the deadline. The data on the Electoral bonds was published on 14th March 2024. It is now available on the Election commission’s website and anyone can access it.

Findings from the data.

SBI in its report disclosed that from 1st April 2019 to 15th Feb 2024 total of 22217 bonds have been brought which are of ₹ 100000, ₹ 1000000, and ₹10000000 value.

Out of the total bonds issued 22030 has been encashed and the rest of the bonds went to the Prime Minister's Relief fund.

The data is available in two lists on the ECI website i.e. one list includes names of the bond purchasers and another list includes the name of the political party that gets the bond.

The data is available in two lists on the ECI website i.e. one list includes names of the bond purchasers and another list includes the name of the political party that gets the bond.

• But the main thing on which the Supreme Court is rude is that the data does not show to which political party is funded by which individual or a corporate group.
• This will be shown with the help of the Hidden alphanumeric code which is present with SBI.
• Now Supreme Court directed SBI not to be selective in providing the data and to provide the exact data as it is to the Election Commission of India. The Notice has been issued to SBI from the Supreme Court.  
• It is clear from the data that the ruling party gets the mother's share of the bonds.

Concerns on the Electoral Bond scheme.

1. As a voter I have the complete right to know how much assets and capital a political party has and how it is used in the election process.
2. Electoral bonds may also be the result of favour from the ruling party.
3. In some cases there may be a probability of Shell Company funding.
4. Only the national party that fulfills the above-said conditions will be eligible to get the donations from electoral bonds while others do not.
5. Anonymity of bond purchasers above ₹ 20000 but below that is not. However, individuals with small donations are more exposed than corporate groups.
6. Most importantly right to equality and the right to information are violated.

Supreme Court Facts in the matter.

Supreme Court is very much interested in the issues related to electoral reforms and always provides necessary guidelines for the reforms so that democracy will be at its best.

• In this case, also it praised the positive approach of the government of India for developing a transparent mechanism of the Electoral Bond Scheme but it violated the right to information.
• The Supreme Court concludes that this issue is not more about the violation of rights but it is much concerned with the balance of rights. The balance of the right to Information and the right to privacy, both being fundamental rights.
• For the balance of the rights issue, the Supreme Court decided to go with the double proportionality test. As a result Right to Information overrides the Right to privacy and hence the electoral bond scheme was declared unconstitutional by the Supreme Court

Way forward.

The government must adopt the least intrusive method where the rights of the citizens are not violated and the government must come up with some more reforms as the replacement of paper bonds with digital bonds which are easy to track.

Moreover, electoral bonds if reformed by the government must be in limited number to keep a check on the same and its importance and values are preserved.

The government must comply with the judgment of ADR(Association of Democratic Reforms) v/s Union of India case 2002, in which it is the responsibility of the person and the political party to furnish the details of assets, criminal records, and qualifications among others to the general public.