SC Questions Role of Election Commission in Cleaning Up Election Finances

The Supreme Court Bech comprising of Chief Justice DY Chandrachud Justice JB Pardiwata and Justice Manoj Mishra raised the Question on Electoral Bond and said that why the Election Commission wasn’t the entity responsible for cleaning up election finances. Supreme Court raised this query on Wednesday, November 1, while commencing the hearing on validity of Electoral Bonds.
India’s Solicitor General (SG) Tushar Mehta defended the electoral policy and argued that if all donations were given to the Election Commission of India for equitable distribution, nothing would come through official channels, and everything would be in cash. He emphasized that this scheme, which protects the privacy of citizens making donations to political parties, is crucial.
SG Tushar Mehta highlighted the importance of safeguarding “privacy” and the “political affiliation of the citizens who make such donations to political parties.”
In prior written submissions, the Union government had asserted that citizens do not possess a fundamental right to know the source of political funding. Attorney General R. Venkataramani contended that the “right to know” must be subject to reasonable restrictions and should serve specific purposes.
AG Venkataramani had also noted in writing that if the Supreme Court attempted to regulate electoral bonds, it would be encroaching into the realm of policy.
SG Tushar Mehta argued that the scheme strives to strike a balance between transparency and the protection of donor confidentiality. He pointed out that donors frequently resort to using unaccounted cash for political contributions due to fears of potential victimization or retribution from other political parties.
SG Mehta stated that previous government initiatives aimed at cleaning up the source of political donations, including tax exemptions and electoral trusts, had proven unsuccessful.
The electoral bond does not disclose the name of the buyer or payee to protect citizens’ right to privacy regarding their political affiliations and their choice of funding a political party without fear of repercussions. This aligns with the state’s obligation to safeguard citizens’ privacy, which includes the right to informational privacy, including knowledge of the political affiliations of its citizens.
The current scheme addresses “donor resistance” and the need to protect donor identities. Mehta contended that eliminating the confidentiality aspect would render the scheme ineffective and could result in a resurgence of cash-based political contributions.
He emphasized that all arguments made by petitioners regarding the right to know and the necessity of transparency should be examined in light of the above perspective.
Mehta questioned the potential benefits of revealing donor identities, stating that confidentiality is vital for clean political funding and democratic practices. He stressed that the elements of anonymity and information privacy are essential to encourage and popularize the scheme.
Justice Khanna raised concerns about whether confidentiality truly serves a greater public interest and the risk of selective confidentiality. Mehta countered that the State Bank of India maintains complete confidentiality and the government cannot discern the donor’s choice.
Mehta argued at length that there would be no quid pro quo between the party in power and the way electoral bonds have been designed. He asserted that the party in power would not have knowledge of who is donating to whom. The 15-day window for encashing bonds was also defended as a measure to prevent quid pro quo.
CJI Chandrachud pointed out that the scheme doesn’t prevent retribution and gave an example involving the Companies Act. Mehta insisted that the party in power could never know the specifics of the donations.