One day following the Supreme Court's decision to uphold the 2019 interim order mandating the disclosure of all political funding data, the Supreme Court, headed by Chief Justice DY Chandrachud, is now actively considering the arguments presented by Solicitor General Tushar Mehta, Senior Advocate Vijay Hansaria, and Senior Advocate Sanjay Hegde in the case pertaining to Electoral bonds. This crucial hearing is scheduled for November 1st.
The panel, led by Chief Justice Chandrachud, and comprising Justices Sanjiv Khanna, BR Gavai, JB Pardiwala, and Manoj Misra, is currently reviewing a series of petitions challenging the legitimacy of the electoral bonds scheme as a means of financing political parties.
Presenting the case on behalf of the petitioners, senior advocate Vijay Hansaria asserted, as reported by the legal website, that the scheme diminishes transparency and promotes opacity.
He further emphasized that subsection 3A of Section 182 in the Companies Act, 2013, eliminates the necessity of providing specific details regarding the amount contributed and the recipient party.
In response, Justice Khanna pointed out that even if that provision is removed, there remains an obligation to disclose the amount that must be paid.
Expanding on the issue of full tax exemption under Section 80G of the Income Tax Act, Hansaria contended that a company is solely obligated to reveal in its profit and loss account the overall sum it has contributed to a political party, without specifying the party's name. He went on to explain that companies are now only mandated to declare a generic figure, such as 'X' amount has been donated, and this lack of specific details renders tracking the contributions virtually impossible.
Among other things, Hansaria raised concerns as there is no ceiling on the total contribution that can be made.
In response to the concerns expressed by both Justice Khanna and Chief Justice Chandrachud regarding the extent of donations directed towards a specific political party, Solicitor General Mehta emphasized that "There are no restrictions." He further noted that individuals who share similar interests can collaborate to establish a trust and make collective contributions.
Hansaria referred to data compiled by ADR on electoral trust figures, saying "There are 18 electoral trusts who have contributed ₹49 crore", adding that the information is available with the Election Commission.
When Hansaria noted, as the legal daily quoted, "One of the arguments is that disclosure is required of the 'candidates', not of 'political parties'", CJI said, "Really, our law did not speak of 'political party' at all".
Senior Advocate Sanjay Hegde, representing an applicant, highlighted, as quoted by the legal daily, that electoral bonds issued by a company are intended for specific elections, and the process requires a board of directors' resolution, which is typically not accessible to the public. He further pointed out that when a political party utilizes the funds obtained from electoral bonds, which must be "cashed" within 15 days, there are no restrictions on their usage.
The petitioners had previously informed the court that their primary focus would revolve around two key aspects of the electoral bonds scheme: firstly, the legalization of anonymous donations to political parties, and secondly, the violation of citizens' right to access information regarding political party funding.
The Supreme Court clarified that it would refrain from delving into the legal matter related to the passage of the scheme as a 'Money Bill' because this issue is already under consideration by a seven-judge Constitution Bench.
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