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Electoral Bonds Case Day 2 Hearing Uncovers Transparency Challenges in Fair Political Funding In India

Electoral Bonds Case Day 2 Hearing : The second day of the Electoral Bonds case hearing in the Supreme Court emphasized concerns about transparency and political funding. Key points include transparency challenges, disclosure issues, tax exemptions, contribution limits, and more.

New Delhi,01 November(City Times): Electoral Bonds Case Day 2 Hearing: The second day of the Electoral Bonds case hearing in the Supreme Court was marked by an intense exchange of arguments. The bench, led by Chief Justice DY Chandrachud, continued listening to the arguments of key figures in the case, seeking to challenge the validity of the electoral bonds scheme for funding political parties. This contentious case has raised important questions about transparency and political funding in India.

Electoral Bonds Case Background

The electoral bonds scheme was introduced by the Indian government in January 2018 as an alternative to cash donations to political parties. The intention behind the scheme was to enhance transparency in political funding. However, it has faced criticism, particularly regarding the anonymity of donors.(Electoral Bonds Case Day 2 Hearing)

Electoral Bonds Case: Key Points from Day 2

  1. Demeaning Transparency: Senior Advocate Vijay Hansaria, representing the petitioners, argued that the electoral bonds scheme undermines transparency and exacerbates opacity.
  2. Omitted Particulars: He pointed out that subsection 3A to Section 182 of the Companies Act, 2013, removes the obligation to specify the amount and the recipient party of contributions.
  3. Disclosure of Amount: Justice Khanna emphasized that even without the omitted particulars, the amount of the contribution must still be disclosed.
  4. Tax Exemption Impact: Vijay Hansaria also raised concerns about tax exemption under Section 80G of the Income Tax Act. He explained that companies are only required to disclose the total amount contributed to a political party in their profit and loss account without disclosing the recipient party’s name, making tracing impossible.
  5. Absence of Contribution Limit: The absence of a cap on the total contributions raised concerns.
  6. No Restrictions on Donations: Solicitor General Tushar Mehta stated that there are no restrictions, and like-minded individuals can form trusts and collectively donate.
  7. Electoral Trust Figures: Hansaria referred to data compiled by ADR on electoral trust contributions, highlighting that 18 electoral trusts had contributed ₹49 crore, with this information available to the Election Commission.
  8. Disclosure Requirement: Chief Justice DY Chandrachud noted that the law did not initially reference political parties, focusing on candidates instead.
  9. Election-Specific Bonds: Senior Advocate Sanjay Hegde pointed out that electoral bonds issued by companies are election-specific and require a board of directors’ resolution, usually not open to the public. He also highlighted the lack of restrictions on how political parties use funds from electoral bonds, which can be “cashed” within 15 days.
  10. Imposing Further Directions: Advocates Sanjay Hegde and Kapil Sibal recommended the court consider additional directions to reduce opacity in the electoral bonds system.

Complexities Around political funding in India

The second day of the Electoral Bonds case hearing revealed the complexities surrounding political funding transparency in India. The arguments and concerns presented highlight the need for a thorough examination of the electoral bonds scheme’s implications on political funding and accountability. This case has the potential to shape the future of political financing in the country.(Electoral Bonds Case Day 2 Hearing)

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