On Sunday, March 31, Mysore Open Forum (MOF) had arranged a talk on ‘Electoral Bonds and Political Funding.’ It is understandable because the Supreme Court has on Feb. 15, 2024 struck down the Electoral Bonds Scheme (EBS) as ‘unconstitutional’, ‘arbitrary and violative of Article 14.’ And MOF members wanted to know why and how of this judgement which would impact on our democratic electoral results.

The euphoria seen among the opposition political parties of our country and, of course, the petitioners is also understandable.

Writ petitions were filed in the Supreme Court in September, 2017 challenging the notification issued by the Ministry of  Finance that introduced Electoral Bonds Scheme-2018.

The reason for their ecstasy and a sense of triumph was this judgement of the Supreme Court. It said the donations given under the Electoral Bonds Scheme violated certain rights of the voters under Article 19 (1) (a).

The Supreme Court also ordered complete disclosure of transaction details from SBI, which has been done since. However, while striking down the Electoral Bonds Scheme, the Supreme Court has not suggested an alternative transparent method or scheme for collecting electoral funds by political parties. As such the question of a fool-proof transparent scheme for collecting electoral funds  remains hanging in the air.

It is pertinent to understand that collection of electoral funds by political parties or politicians is a common practice in all democracies all over the world. After all, elections cannot be fought without money and money can be generated only through donations from individuals, industries and corporate organisations.

In fact, the idea of an Electoral Bonds Scheme was born while presenting the 2017-18 Union Budget by the then Finance Minister Arun Jaitley. The compelling reason for the scheme was the rampant corruption and role of black money in collecting electoral funds by the political parties across the board. Therefore, the Electoral Bonds Scheme was introduced as a transparent method of funding political parties with white money by individuals, industries and corporates which would enable a free and fair election.

The then Finance Minister thought the scheme would cleanse the system of raising funds by political parties. But, unfortunately, good intentions do not always necessarily lead to good results. As the saying goes, ‘Even the road to hell is paved with good intentions.’ No wonder Prime Minister Narendra Modi’s reaction was rather cryptic. He said ‘People who are protesting against Electoral Bonds Scheme will soon regret it.’ According to him, before BJP came to power in 2014 there was no trail of funds given to political parties during the elections. Thanks to Electoral Bonds, we can now trace the source of funding. He added a wise counselling, ‘Nothing is perfect, but imperfections can be addressed.’ Herein lies one more opportunity for the government to make a course correction and reintroduce the Electoral Bonds Scheme in a new avatar which will be free from Constitutional or other legal infirmities as is found now by the Supreme Court.

Be that as it may, it is in this context the Convenor of MOF Prof. M. Umapathy decided to arrange a talk on ‘Electoral Bonds and Political Funding’ by Prof. Trilochan Sastry of Indian Institute of Management (IIM), Bangalore, who is the Chairman of the NGO Association For Democratic Reforms (ADR), last Sunday.

Prof. Trilochan Sastry was one of the petitioners in the Writ Petition filed before the Supreme Court challenging the Electoral Bonds Scheme. Among others who filed the petition include Congress leader Jaya Thakur and the Communist Party of India (Marxist). He indeed delivered a highly informative and well-structured talk on the subject.

He first explained the reasons for filing the petition in Supreme Court. The first reason was that under the Scheme, the VOTER would not know who funded whom. This violates the fundamental right of a voter given by the Constitution of India. To know who donated how much money to whom is a voter’s fundamental right. The Electoral Bonds Scheme violated this right.

The other reasons he mentioned related to challenging the amendments of RBI Act, the RP Act, IT Act and the Companies Act under the provisions of the Finance Act of 2017. Indeed, a Constitutional and legal acrobatics!

He said that the Reserve Bank of India (RBI) had its own objections to the Scheme. One objection was that the Scheme would impact the principles of the Prevention of Money Laundering Act, 2002.

The Election Commission of India (ECI) too had its own objection. It said it is a retrograde step as far as transparency of donation is concerned and this proviso needs to be withdrawn. It had issues regarding donations from government companies and foreign sources that are prohibited under the RP Act, 1951. “But the government in royal disdain ignored the advice of RBI and ECI,” said Prof. Trilochan Sastry. In spite of these objections, the government went ahead and notified the Electoral Bonds Scheme.

Anyway, for the ADR it was a great victory and now it has a moral responsibility of presenting to the country, specially the voters for whose rights it claimed to have filed this petition, an alternative model to curb illegal, immoral, anonymous and secret donations to political parties and end the role of black money in our elections. It can thus justify its eponymous name Association for Democratic Reforms (ADR). Yes sir, bring in the Reformation.

After all, EBS is also a step towards democratic reforms. Now, let the ADR present its scheme for raising electoral funds by the political parties in a way that is both transparent and guarantees Right to Privacy of the donor, which is also a Fundamental Right under the Constitution. Let it not be the case of ‘we have killed the tyrant, but tyranny continues!’

It might be difficult. Like trying to have your cake and eat it too. Making an observation Prof. Trilochan Sastry said, we must try to achieve transparency, cap donation and limit election spending by political parties. He also alluded to the problems of extortion and quid pro quo when political parties take donations.

The public funding of election was also briefly mentioned in the talk to provide a level playing ground in the election so that good candidates too can contest.

It is said by an American journalist that in India people indeed have votes but sadly they are not represented. I thought Prof. Umapathy of MOF expressed the same opinion about Indian democracy in his summing up of the talk. He said, ‘we seem to be playing a drama of democracy because it brings legitimacy.’ After all, governments are run by a few leaders only. There was an interesting, rather out-of-the-box suggestion during the interaction. The voter should pay Rs. 1,000 once in five years (the time of election) to his or her favourite party or the candidate etc.,                                                              etc. On my part I suggested government funding the political parties, the grant corresponding to the number of candidates each party is fielding to contest the election.

Prof. Trilochan Sastry added his own idea by recalling Netaji Subhas Chandra Bose, who said ‘Give me your blood and I shall give you freedom!’ Likewise, let the voter pay for the electoral fund and the ECI will give you good candidates.

Having said this, it seems to augur well that many are trying to script the destiny of our country for a brighter future though after 76 years of Independence.

Sting in the tail: A wag said all that India needs to cleanse the electoral system, including funding, is a tall Chief Election Commissioner like T.N. Seshan. At present those who are dealing with the infirmities and lapses in our electoral system are like Englishmen in London. Every one complains about the weather but nobody does anything about it.

In the world of make-believe, Alfred Hitchcock’s name is known for producing suspense films. Once when a journalist complained of headache, he instantly suggested a remedy, “Cut off the head.” Did you get me Steve?

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