Political Parties Must Be Subject To the Same Stringent Transparency Rules as NGOs
The Supreme Court of India's (SC) sensational order on 14th February, declaring the electoral bond scheme 'unconstitutional', has been a landmark decision. By mandating the mapping of donors to funds and beneficiaries, the SC has turned the spotlight on the need for transparency and accountability from political parties. (Read: Electoral Bonds Scheme Struck Down by Supreme Court; Asks ECI To Publish Contributions Received by Parties through EBs)
Bharatiya Janata Party (BJP) was the largest beneficiary, receiving over half of all donated funds (Rs8,250 crore). This sparked media speculation linking donations to benefits such as large contracts or the fear of raids by tax and enforcement agencies. There is a sufficient link between the timing of the donation and such actions, to justify such speculation. The data shows that Opposition parties also fared well, getting nearly half the funds donated. The Congress received over Rs1,000 crore. The regional parties didn’t do too badly either.
However, attention has been exclusively focused on how much money the BJP got from whom and how. The bigger issue is the need to create structures that mandate transparency and accountability from all political parties.
Introduced in January 2018, electoral bonds issued by the State Bank of India (SBI) allowed individuals and corporates to buy the bonds and donate them anonymously to political parties. The SC has now ordered that each bond's unique alphanumeric code be used to map donors with beneficiaries and disclose this to the election commission of India (ECI).
Striking down the scheme as illegal, SC asserted the public's right to know who funded political parties and ordered SBI to disclose information on both, the buyers and the beneficiaries, of the bonds.
Despite this ruling, disclosure remains limited to donations after 2019. The Right to Information (RTI) filings by commodore Lokesh Batra (retd) have revealed that over Rs16,492 crore was raised through bonds. His investigations also exposed the Reserve Bank of India’s (RBI’s) and ECI’s opposition to the electoral bond scheme which had led to amendments to the RBI Act, the Income-Tax Act and the Representation of People’s Act.
Until the data was disclosed following the Court orders, it was assumed that BJP and its allies in the National Democratic Alliance (NDA) had cornered an overwhelming majority of the bonds and that every donation was triggered by fear (bribe after raids) or greed (large government contracts).
How then does one explain large donations to the Congress, which has been in Opposition for a decade, or to significant regional parties? Did they adopt the same formula?  Remember, only the Left parties are truly looking good after the electoral bond order. The Communist Party of India (CPI), CPI (Marxist) and CPI (Marxist-Leninist) had opposed the scheme from the beginning and did not accept donations through electoral bonds as a matter of principle. They were also one of the three petitioners who challenged the scheme in the apex court.
It's absurd to argue that only the NDA donations were due to quid-pro-quo deals, while Opposition party donations were purely out of love and support. Logically, similar arrangements must be assumed at regional and state levels. With five parties revealing donor identities to the ECI, it's clear that political parties knew who was donating through electoral bonds.
Significantly, over 500 smaller political parties, both recognised and unrecognised, informed the Court that they had received no donation through bonds. Clearly, they had no bargaining chips!
Mapping bonds to donors and political parties is essential for unearthing murky dealings facilitated by anonymity. Contrary to arguments by certain corporate honchos, anonymous bonds only facilitated murky deals through official banking channels. Some even suggest businessmen may have used donations to launder funds. There is no evidence of this, as yet.
The SC judgement, arriving on the eve of a general election, is a significant boost for the Opposition. However, aside from the Left parties, none has earned credit. In fact, the fight against electoral bonds has been led by individuals, digital media publications and non-government organisations (NGOs), supported by activist lawyers such as Prashant Bhushan, in presenting a coherent case before the Supreme Court.
The dogged fight of commodore Batra (retd) through the effective use of the Right to Information (RTI) Act underpinned the case brought by the Association of Democratic Reforms (ADR). Journalist Poonam Agarwal of The Quint purchased two bonds and submitted them to a forensic laboratory, unearthing vital details regarding a concealed unique alphanumeric code. The government later admitted the bonds were numbered.
Accountability Imperative
Over the past decade, the BJP-led government has initiated an extensive clampdown on NGOs, citing the need for enhanced transparency and accountability. Compliance regulations are now so onerous that thousands of small organisations have ceased operations. Funds allocated through corporate social responsibility (CSR) schemes are closely scrutinised, necessitating separate audits for each funded project.
The predicament is even more severe for NGOs permitted to receive foreign donations under the Foreign Contribution (Regulation) Act (FCRA). Some new rules are even unjust.
For example, if an NGO with FCRA registration wishes to voluntarily relinquish the registration, all the remaining money in the designated bank FCRA account is forfeited by the government, even if donations are not project-specific and there isn’t even a whiff of mis-utilisation.
I have no qualms with the government demanding transparency and accountability from NGOs, provided the rules are fair and reasonable. They are not. Conversely, political donations, which are even more sensitive, have been entirely opaque and unaccountable for eight years, while NGOs face harassment.
Recently, a clip of the SC proceedings has gone viral, where Dhanajay Chandrachud, the chief justice of India, firmly refused to yield to a senior counsel saying – “what is sauce for the goose is sauce for the gander.”
Surely, this principle should apply to the government as well. The exact same rules of transparency imposed on NGOs must apply to political parties' fundraising efforts. They must include electoral bonds, as well as the PM CARES Fund which is an NGO with super-benefits and no transparency.
NGOs and political parties rely on donations and enjoy tax benefits. Therefore, they should be subject to identical rigorous disclosures. NGOs as well as political parties, claim that their raison d’être is to serve the people. The government justified strict compliance for NGOs based on unproven suspicions of 'anti-national' activities. Most political parties focus primarily on political control and power over people. This is clear from the manner in which scores of elected representatives have colluded to split parties and switch sides without permission from their voters. Logically, they should be subject to the same rules of audit, transparency and accountability that are imposed on NGOs.
Consequently, disclosures by political parties must go beyond merely connecting buyers of electoral bonds to political parties. Political parties enjoy tax exemption and, hence, must be asked to show audited proof of utilisation of funds received through bonds. This becomes all the more important when political parties audaciously refuse to reveal the names of donors with the absurd claim that electoral bonds were anonymously dropped off at their offices.
Indeed, this very notion of 'what is sauce for the goose…' should also apply to the PM CARES Fund. Established during the COVID pandemic, this Fund reportedly, amassed over Rs12,700 crore with no public information on its usage. It has been permitted to receive donations under FCRA, with allegations surrounding contributions from Chinese or China-based companies. The SC order has opened the door to demanding transparency and accountability from political parties. Let us ensure it goes all the way.
Also read:
3 weeks ago
political par ties collect fund through coupons. as per their books. not small but bigger then bond.
ec should ask who collected , from which state . money need to deposit in first state ac or through state in central ac . why cash collection when digital is available. how ed. much send on printing ,
coupon and where they printed.
mp collect fund for their own election . that ac again is not clear. daily lakhs are spend on banner . who pay. do they show in ac ?
Pragna Mankodi
3 weeks ago
political funding is not new. Even Mohandas Karamchand Gandhi used to approach Birlas & Bajaj in times of need. Their proximity to Congress is well known.
3 weeks ago
As Mr. Debasish questions: Who will do it, and why?

Voters: A large portion takes bribe to vote!

Candidates: Involved in money siphoning of their own political parties.

Corporates: A good chunk is hand in glove with politicians.

Bureaucracy: Corrupt, inefficient and conduit to their political bosses.

That leaves only Press and Judiciary. Will they or can they do it?
Pragna Mankodi
Replied to ASHISH MAHESHWARI comment 3 weeks ago
Even with the Press everything is not hunky dory! Politicians and the Journalists are also hands in gloves with one another to protect there vested interest by using the privileged information to manipulate.
3 weeks ago
All organizations are equal but some organizations are more equal than others.
3 weeks ago
NGOs are an ideal front and shell for money laundering and nefarious covert ops from foreign countries. It's all right out of the MIC playbook.
4 weeks ago
Electoral Bonds may have a purpose but what is the need of PM Cares Fund?
4 weeks ago
No one should be allowed to donate via any company. Political parties should collect money from the supporters or individuals to fight the election. Same like how people donating in the temple or churches or Mosque. SC should made Political parties and ask them to disclose how they spend the money in election. Voter should have every right to know what exactly political parties using the money. For individuals govt tracking every transaction via PAN and UPI. Why allow political parties to escape from scrutiny. EOD every citizens need to bear the burden, same company who has donated money to parties collect it from the end user. Like Airtel will increase the pricing and recover the amount. nothing is free. 0.5 CR people paying 80% taxes in India. 148 CR people will enjoy the benefit including politicians.
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