Advocate Prashant Bhushan appearing for ADR requested the apex court for an urgent hearing as, despite the pendency of this case, electoral bonds continue to be issued before elections

The Supreme Court (SC) on Thursday said that the demand to consider referring the case of the electoral bonds to a constitution bench will require a hearing and posted the matter for consideration in the last week of January next year.

The issue of electoral bonds has remained under consideration before the top court since 2015 following a petition filed by Association for Democratic Reforms (ADR) and others. A clutch of other petitions also challenged the orders passed by the government from time to time allowing political parties to obtain funds from other sources including corporate entities.

With the primary petitioner ADR moving an application to refer the matter to a constitution bench of five judges, the bench of justices BR Gavai and Vikram Nath said, “We need to hear all sides. It is not necessary that the centre and election commission of India (ECI) will agree to such a reference. Even to decide whether it must be referred requires arguments to be addressed.”

The bench posted the matter in the last week of January while enquiring from the petitioners, “When are the nearest elections? We do not think it is in the next two to three months.”

Advocate Prashant Bhushan appearing for ADR requested the apex court for an urgent hearing as, despite the pendency of this case, electoral bonds continue to be issued before elections. The SC told Bhushan, “When these petitions are pending since 2015, you cannot have such urgency on the penultimate day of vacation.”

In March 2021, the petitioner ADR approached the SC to stay the sale of electoral bonds ahead of elections in West Bengal, Tamil Nadu, Assam, Kerala and Puducherry. The SS refused to pass any orders and observed that the bonds have been issued since January 2018 “without any impediment” and there were inbuilt safeguards placed by the top court to avoid its misuse.

The SC was referring to its order of April 2019 when it directed all political parties to submit details of receipts of the electoral bonds to the ECI in a sealed cover. This was done as an interim measure till the pending petitions challenging the validity of these electoral bonds were decided.

The commission supported the electoral bond policy and informed the SC that it received sealed covers from various political parties (national, state, registered and unregistered) as per the April 12, 2019 order.

The ADR alleged that electoral bonds could be a channel for corporate bribes to be paid to political parties as a quid pro quo since the scheme envisaged the anonymity of donors. It relied on a letter written by the Reserve Bank of India (RBI) in September 2017, expressing serious reservations over this policy.

The SC order in 2021 concluded that the RBI’s concern was on the issue of bonds in scrip form rather than in dematerialised (electronic) form.

Bhushan further alleged that the bonds could be purchased by a person using white money and later can be transferred to anyone in black.

The SC had in the past held that those purchasing these bonds have to comply with KYC norms and their identities will be known to the State Bank of India (SBI), which issues the bonds.

The SC in its 2021 order observed, “It is not as though the operations under the scheme are behind iron curtains incapable of being pierced…all that is required is a little more effort to cull out such information from both sides (purchaser of bond and political party) and do some ‘match the following’.”