Supreme Court To Hear Petition Against Electoral Bonds

Context:

• The Supreme Court outlined that it will hear petitions challenging the electoral bonds scheme on October 31,2023.

What are the electoral bonds?

• The electoral bonds were introduced with the Finance Bill (2017). 
• It can be bought digitally or through cheque by any Indian citizen or company incorporated in India from select branches of State Bank of India. 
• The bonds are similar to bank notes that are payable to the bearer on demand and are free of interest. 
• There is no limit on the number of bonds an individual or company can purchase.
• Condition:
  • Any party that is registered under section 29A of the Representation of the Peoples Act, 1951 and has secured at least one percent of the votes polled in the most recent General elections or Assembly elections is eligible to receive electoral bonds. 
  • The party will be allotted a verified account by the Election Commission of India (ECI) and the electoral bond transactions can be made only through this account.

What concerns are related to the electoral bonds?

• Anonymity:  The electoral bonds do not bear the name of the donor. Thus, the political party might not be aware of the donor’s identity.
• Scope of Funding enlarged: Before the electoral-bonds scheme, there was a 7.5% cap on corporate donations to political parties based on their average net profits in the preceding three years. 
  • The government removed this limit, allowing unlimited corporate funding for political parties.
• Government Oversight of Political Donations: Bonds are sold via a government-owned bank (SBI), it leaves the door open for the government to know exactly who is funding its opponents.

News Source: The Indian Express

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