Supreme Court Ruling Declares Electoral Bonds Unconstitutional

The Supreme Court of India has delivered a landmark ruling declaring the government’s electoral bonds scheme unconstitutional on Thursday. The court found several associated amendments to laws, including the Representation of the People Act and the Income Tax Act, to be in violation of citizens’ right to information.

Chief Justice DY Chandrachud and a five-judge constitutional bench highlighted that the right to information is fundamental in a democracy and that electoral bonds compromised this right. They directed the State Bank of India to halt the issuance of electoral bonds and submit detailed information on all previous bond purchases to the Election Commission of India.

Furthermore, the court emphasized that the government’s argument of curbing black money through electoral bonds did not hold sufficient grounds. It pointed out that anonymity in political funding could lead to quid pro quo arrangements, undermining the integrity of the electoral process.

The ruling impacts political funding significantly, especially as the general elections are fast approaching. The verdict brought by the Supreme Court is expected to restore faith in democracy and transparency in political financing.

Electoral bonds were introduced following the announcement by then Finance Minister Arun Jaitley in the 2017 Union Budget speech. The scheme allowed for anonymous donations to political parties through bearer instruments issued by the State Bank of India in various denominations.

Over the years, electoral bonds faced challenges in the Supreme Court from various parties and organizations, including the Association for Democratic Reforms and the Communist Party of India (Marxist). The data revealed that a significant portion of electoral bond values was purchased during the general elections in 2019, raising concerns about corporate dominance in political financing.