SC Strikes Down Electoral Bonds Scheme: Transparency vs. Anonymity
- ByAdmin --
- 30 Jun 2025 --
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Introduction
The Supreme Court's decision to strike down the Electoral Bonds Scheme has ignited widespread debate on the balance between transparency and anonymity in political funding. This landmark judgment marks a pivotal moment in India's democratic journey, emphasizing the need for electoral integrity while scrutinizing the legal and ethical implications of anonymous donations.
What Are Electoral Bonds?
Introduced in 2017 under the Finance Act, the Electoral Bonds Scheme aimed to reform political funding by allowing individuals and entities to contribute to political parties through bank-issued bonds. These bonds could be purchased from authorized banks and donated anonymously. Proponents argued that this scheme eliminated cash donations and encouraged banking transparency. However, critics contended that it fostered opacity, shielding the identity of donors and paving the way for undue influence on policy decisions.
The Supreme Court’s Judgment
On June 10, 2025, the Supreme Court invalidated the scheme, citing violations of constitutional principles, including:
- Right to Information (Article 19(1)(a)): The anonymity of donors infringed upon citizens' right to know who influences political parties and, by extension, public policy.
- Equality in Political Contest (Article 14): By enabling substantial corporate donations, the scheme created an uneven playing field, favoring well-funded parties.
- Undermining Electoral Integrity: The court noted the scheme's potential misuse for money laundering and undisclosed foreign influence, threatening democratic values.
Key Points of Criticism in the Judgment
- Lack of Transparency: The absence of donor disclosure contradicted the electoral ethos, which necessitates public awareness of political funding sources.
- Legislative Route: The scheme's introduction through a Money Bill bypassed adequate parliamentary scrutiny, violating constitutional processes.
- Regulatory Oversight: The weakening of the Election Commission of India's (ECI) role and the dilution of the Foreign Contribution (Regulation) Act, 2010, raised alarms about unchecked foreign donations.
Relevant Acts and Articles Referenced
- Finance Act, 2017: Introduced the Electoral Bonds Scheme via amendments.
- Representation of the People Act, 1951: Governs electoral transparency and integrity.
- Foreign Contribution (Regulation) Act, 2010: Regulates foreign donations to prevent undue influence in India’s politics.
- Article 19(1)(a): Guarantees the right to freedom of speech and expression, including the right to information.
- Article 14: Enshrines the right to equality before the law.
Implications of the Ruling
The decision has profound implications for India’s democratic fabric:
- Political Accountability: Parties must disclose donor identities, ensuring accountability in funding.
- Level Playing Field: Smaller and regional parties stand to benefit from a reduction in the disproportionate influence of corporate donations.
- Strengthened Electoral Institutions: The ruling reinforces the ECI's mandate to oversee political financing.
Balancing Transparency and Privacy
The court acknowledged the delicate balance between donor anonymity and public interest. While privacy in donations is crucial to prevent donor victimization, excessive secrecy undermines democratic accountability. The judgment urges the government to explore alternative funding mechanisms, such as state funding of elections or a regulated public donation system.
Conclusion
The Supreme Court’s judgment striking down the Electoral Bonds Scheme is a significant step towards restoring transparency in India's electoral process. It underscores the judiciary’s role as the guardian of constitutional values, reaffirming that democratic principles must not be compromised in the name of reform. Moving forward, policymakers must design a robust and transparent political funding framework to safeguard electoral integrity and enhance public trust in the democratic process.
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