In deep freeze, electoral bonds case may come up in SC on September 19

The Supreme Court will likely hear pending petitions challenging the Electoral Bond Scheme on September 19. The petitions filed by NGO Association for Democratic Reforms (ADR) figure in the advance cause list of the top court for September 19.

The matter last came up in the court on March 26, 2021, when a bench headed by the then Chief Justice of India S A Bobde dismissed an application filed by ADR seeking a stay on any fresh sale of electoral bonds ahead of the Assembly elections that were due at the time.

The top court questioned claims regarding “complete anonymity” of the purchasers of the bonds and said “it is not as though the operations under the Scheme are behind iron curtains incapable of being pierced”.

Dismissing the prayer not to allow any new window for their sale till its main petition challenging the scheme is decided, the court pointed out that the bonds had already been issued in the past without any impediment and that it had ordered “certain safeguards”.

“Therefore, in the light of the fact that the Scheme was introduced on 2.1.2018; that the bonds are released at periodical intervals in January, April, July and October of every year; that they had been so released in the years 2018, 2019 and 2020 without any impediment; and that certain safeguards have already been provided by this Court in its interim order dated 12.4.2019, we do not see any justification for the grant of stay at this stage. Hence both the applications for stay are dismissed,” the SC had said.

The court’s reference was to its April 12, 2019 interim order by which it directed political parties that have received donations through Electoral Bonds to “forthwith” submit the details of these bonds to the EC. That order too had come on the petition filed by ADR in September 2017.

The NGO had again approached the court with the application seeking a stay in view of the Assembly polls. The plea contended that the identity of the donors could never be known to the public and referred to reservations raised by the Reserve Bank of India and Election Commission to the Scheme.

The bench referred to the Election Commission recieving details of contributions received through bonds, in pursuance of its April 2019 order, and said “we do not know at this stage as to how far the allegation that under the Scheme, there would be complete anonymity in the financing of political parties by corporate houses, both in India and abroad, is sustainable”.

“If the purchase of the bonds as well as their encashment could happen only through banking channels and if purchase of bonds are allowed only to customers who fulfill KYC norms, the information about the purchaser will certainly be available with the SBI which alone is authorised to issue and encash the bonds as per the Scheme. Moreover, any expenditure incurred by anyone in purchasing the bonds through banking channels, will have to be accounted as an expenditure in his books of accounts. The trial balance, cash flow statement, profit and loss account and balance sheet of companies which purchase Electoral Bonds will have to necessarily reflect the amount spent by way of expenditure in the purchase of Electoral Bonds,” the bench said.

ADR had argued that though the first purchase may be through banking channels for a consideration paid in white money, someone may repurchase the bonds using black money and hand it over to a political party.

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