The
Supreme Court Wednesday said the problem with electoral bonds scheme is that it
provides for "selective anonymity" and "selective
confidentiality" as the details are available with the State Bank of India
(SBI) and can also be accessed by the law enforcement agencies.
A
five-judge constitution bench headed by Chief Justice D Y Chandrachud observed
the problem with the scheme would lie if it does not provide a level playing
field to political parties and if it suffers from opacity.
While
hearing arguments on a batch of pleas challenging the validity of electoral
bonds scheme for funding political parties, the apex court said the motive
behind the scheme may be perfectly laudable but in an effort to bring in white
money into the electoral process, it essentially provides for a "complete
information hole".
"The
problem with the scheme is it provides for selective anonymity. It is not
completely anonymous. It provides for selective anonymity, selective
confidentiality. it is not confidential qua the State Bank of India. It is not
confidential qua the law enforcement agencies," the bench, also comprising
Justices Sanjiv Khanna, B R Gavai, J B Pardiwala and Manoj Misra, told
Solicitor General Tushar Mehta who was arguing the case for the Centre.
Under
the scheme, electoral bonds can be issued or purchased from some authorised
branches of the SBI.
"Your
argument that look if you were to strike down the scheme, you will go to a
situation which existed prior that may not be valid for the reason that we are
not precluding the government from coming out with a transparent scheme or a
scheme which has a level playing field," the CJI observed.
During
the day-long hearing, he said a big donor would never take the risk of buying
electoral bonds for the purpose of tendering it to political parties and never
put his or her head on the line by being in the books of account of the SBI.
The
CJI said a big donor may disaggregate the donation to people who will purchase
electoral bonds with small amounts through the official banking channel and not
through cash.
Mehta,
who told the bench he would explain the entire scheme, said each and every word
in it was very consciously used and what the petitioners have called
"anonymity or opaqueness" was neither anonymous nor opaque but was "confidentiality
by design".
"The
purpose of ensuring that electoral funding relies less and less on cash
component and more and more on accountable component is, of course, a work in
progress and we are completely with you. There is no difficulty," the bench
said.
Making
it clear that the apex court was not saying what the scheme should be, the
bench said maybe the earlier scheme had failed and did not get as much white
money into the electoral funding as desired.
Justice
Khanna said one of the issues was selective confidentiality and it may be
easier for the party in power to get the information about the electoral bonds.
He
said because of selective confidentiality, the opposition parties may not know
who the donors are but the donors of the opposition parties may be identified
at least by the probe agencies.
"We
will have to trust at some stage someone as the final fiduciary
authority," Mehta said, adding, "Nobody has taken your lordships
through the scheme Nobody can come to know, including the Central government".
During
the arguments, the CJI observed that the scheme did not obviate the possibility
of retribution.
The
bench said it was not on the issue of whether a particular political party was
holier than the other and that it was only testing a question of
constitutionality.
Mehta
told the bench that every country was grappling with the problem of use of
black money in election and politics.
He
said country-specific issues were being dealt with by every nation depending
upon the circumstances existing there.
The
solicitor general said every government did its bit to ensure that some
methodology was adopted to eradicate the power of black money or unclean money
in the electoral process.
"Having
tried several attempts, several mechanism and modes, the menace of black money
was not being dealt with as effectively because of the systemic failures and
therefore, the present scheme is a conscious and deliberate attempt to ensure
clean money coming into the banking system and election," he said.
During
the hearing, Justice Khanna referred to the submissions advanced by the
petitioners' side about electoral bonds being given by way of kickbacks, bribes
or quid pro quo.
The
bench asked the Election Commission about the total financing which was
required for each general election or for the state elections on an average,
and amount which was collected through these bonds and used.
"The
issue which may come up is, because we have this opacity with regard to who is
funding etc, then if there is any quid pro quo, how do anybody establish
it?" it asked.
Responding
to the question, Mehta said, "Please, for the time being, for appreciating
my arguments, remove the two expressions repeatedly used, 'anonymity and
opacity'. It is a restricted, limited confidentiality which can be opened and
the veil can be lifted by judicial direction." The hearing remained
inconclusive and will continue on Thursday.
During
the arguments on Tuesday, the petitioners had told the apex court that the
"opaque" electoral bonds scheme for funding political parties will
"destroy democracy as it promotes corruption and does not allow a level
playing field between the ruling and opposition parties.
The
scheme, which was notified by the government on January 2, 2018, was pitched as
an alternative to cash donations made to political parties as part of efforts
to bring in transparency in political funding.
According
to the provisions of the scheme, electoral bonds may be purchased by any
citizen of India or entity incorporated or established in India. An individual
can buy electoral bonds, either singly or jointly with other individuals.
Only
the political parties registered under Section 29A of the Representation of the
People Act, 1951 and which secured not less than one per cent of the votes
polled in the last election to the Lok Sabha or a state legislative assembly
are eligible to receive electoral bonds.
According
to the notification, electoral bonds shall be encashed by an eligible political
party only through an account with an authorised bank.
The
apex court had, in April 2019, declined to stay the electoral bonds scheme and
said it will accord an in-depth hearing on the pleas as the Centre and the EC
had raised "weighty issues" that had "tremendous bearing on the
sanctity of the electoral process in the country".