New Delhi

Amendment in laws making provision for electoral bonds to allow corporates to make undisclosed donations to political parties has come under judicial scanner as Supreme Court on Tuesday agreed to adjudicate its constitutional validity and sought response from Centre and Election Commission.

A bench of Chief Justice Dipak Misra, Justices A M Khanwilkar and D Y Chandrachud issued notice to the Centre and the Commission on a PIL filed by NGOs Association of Democratic Reforms and Common Cause which alleged that the amendments would pave the way for unlimited corporate donations to political parties and anonymous financing by Indian as well as foreign companies.

"Amendments to Reserve Bank of India Act, Representation of the People Act and Income Tax Act have affected transparency in political funding. The consequence of the amendments is that now the annual contribution reports of political parties to be furnished to the Election Commission need not mention names and addresses of those contributing by way of electoral bonds. This will have a major implication on transparency in political funding as now the political parties are free not to file contributions received through electoral bonds," the petition said.

The NGOs contended that the amendments was against the principle to bring transparency in political system and poll panel and the citizens would not know the vital information regarding political contributions.

"The said amendments have removed the caps on campaign donations by companies and have legalised anonymous donations. The Finance Act of 2017 has introduced the use of electoral bonds which is exempt from disclosure under the Representation of Peoples Act, opening doors to unchecked, unknown funding to political parties. If the amendments are not set aside, the corporate houses and extremely wealthy lobby groups can have a stranglehold on the electoral process and governance," the petition said.

"The Finance Act, 2016 has also amended the Foreign Contribution Regulation Act (FCRA) to allow foreign companies with subsidiaries in India to fund political parties in India, effectively, exposing the Indian politics and democracy to international lobbyists who may want to further their agenda. These Amendments pose a serious danger to the autonomy of the country and are bound to adversely affect electoral transparency, encourage corrupt practices in politics and have made the unholy nexus between politics and corporate houses more opaque and treacherous and is bound to be misused by interest groups and corporate lobbyists," they said.

The bench, while seeking response from Centre and Election Commission, tagged NGOs PIL with other similar petitions pending in court.

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