The bank has until 5 pm on Tuesday to submit the details of the electoral bonds purchased since 2019 and the EC has to publish the data by Friday.
The Supreme Court on Monday dismissed State Bank of India’s (SBI) application seeking an extension till June 30 for providing details of electoral bonds, clearing the decks for the publication of the donors’ names by the Election Commission (EC).
In its judgment striking down the Electoral Bond Scheme, the Supreme Court on February 15 ordered the SBI to provide the details to the EC by March 6 and the poll panel to publish the information on its website by March 13. However, two days before the deadline, the SBI moved the court seeking an extension. Now, the court has instructed the SBI to submit the information by the close of business hours on Tuesday and the EC to publish the details by Friday.
What details will the SBI and EC make public?
The details include the date of purchase of an electoral bond, the name of the purchaser and the denomination for each electoral bond in one list, and the details of every electoral bond encashed by political parties, including the date and denomination of the encashment, from April 12, 2019, onwards. The details of the bonds sold and encashed before that date were given to the EC in a sealed cover earlier as per the court’s interim order in 2019. The court on Monday asked the poll panel to publish this data on its website too.
The SBI had argued that it would take time to match the details of donors and parties for the 22,217 electoral bonds in question. In response, the Association for Democratic Reforms (ADR) and the CPI(M) who were the petitioners against the scheme, moved contempt petitions. Chief Justice D Y Chandrachud told the bank on Monday that the “judgment does not tell you to do the matching exercise”.
What were the scheme’s disclosure requirements?
Introduced by the Centre in 2018, the Electoral Bond Scheme allowed individuals and corporations to anonymously fund political parties by purchasing electoral bonds from the SBI. The scheme’s critics have argued that electoral bonds allow donors and political parties to keep their association hidden from the public while the SBI, and by extension, the government, could track the donations.
Parties only provided the EC with the aggregate amount of donations received through electoral bonds every financial year in their annual accounts statements. These reports were made public by the EC after vetting. When the scheme first started, some parties declared the amount received through electoral bonds with the added disclosure that it was via “post”, indicating they did not know the donor’s identity.
How many electoral bonds have been issued since 2018?
The scheme allowed donors to claim income tax exemption. When asked how many taxpayers had claimed the exemption and the amount of tax exempted, the Income Tax Department told The Indian Express in an RTI reply in May 2023: “Data not available with ITD.”
Since the details of donors are exempt from RTI, the SBI, in various RTI replies, has only been providing the total number of bonds sold and encashed over the years and the number of parties eligible to encash bonds. The SBI has also said in multiple replies, including to The Indian Express, that 25 parties have opened bank accounts to encash electoral bonds. Donors are required to complete a KYC form before buying bonds.
In fact, in the months leading up to the Supreme Court judgment, the government printed 8,350 bonds of Rs 1 crore value each between December 29, 2023, and February 15, 2024.
Overall, since 2018, when the scheme was launched, the government printed bonds worth Rs 35,660 crore – 33,000 bonds of Rs 1 crore each and 26,600 bonds of Rs 10 lakh each.
How much have parties received from electoral bonds?
To date, more than half of the funds have gone to the BJP. The party, as per its declarations to the EC, received Rs 6,565 crore via bonds between 2017 and 2023. The Congress was a distant second at Rs 1,123 crore.
The EC has yet to publish the annual reports of parties for the financial year 2023-’24. But between March 2018 and January 2024, the collective amount of funds generated through the sale of electoral bonds is Rs 16,518 crore.
Regional parties in power in states are also big recipients of electoral bonds funds, with the Trinamool Congress that has been in government in West Bengal since 2011 declaring contributions worth Rs 1,093 crore over the years, putting it third after the BJP and Congress.
The AAP, which is in power in Delhi and Punjab and recently became a national party, declared receiving contributions of Rs 94 crore over the years in the category of “electoral bond/electoral trust”. There is no clarity on how much of that amount is via bonds alone. Among the non-ruling parties, the contribution received by the NCP via electoral bonds was among the highest, at Rs 64 crore.
Why did SC strike down electoral bonds?
In its judgment, the Supreme Court unanimously held that voters have a right to information about political parties and their sources of funding. It highlighted the “deep association” between money and politics and how economic inequality contributes to political inequality by increasing the possibility of quid pro quo arrangements for those with the ability to contribute larger amounts to political parties. These arrangements, the court said, could result in favourable policy changes and government licences, which the voters have a right to know about.
The SC held that the right to privacy of political affiliation only extends to contributions that are made as genuine forms of public support, not contributions that are made to influence the policies of a party. Observing that absolute anonymity lies at the heart of the electoral bonds, the court saw fit to strike down the entire scheme.