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Supreme Court Delivers Unanimous Verdict on Electoral Bond Scheme

The Electoral Bond scheme, introduced by the government on January 2, 2018, was positioned as an alternative to cash donations to political parties, aiming to enhance transparency in political funding. The decision comes after a series of pleas challenging the legal validity of the scheme.

By: Team Pardaphash  Pardaphash Group
Supreme Court Delivers Unanimous Verdict on Electoral Bond Scheme

The Supreme Court has announced a unanimous verdict on pleas challenging the legal validity of the Central government’s Electoral Bond scheme, which permits anonymous funding to political parties. The scheme, introduced on January 2, 2018, aimed to provide an alternative to cash donations, intending to enhance transparency in political funding.

Unanimous Verdict by Constitution Bench

A five-judge Constitution bench, led by Chief Justice D Y Chandrachud, had reserved its verdict on November 2, 2022. Chief Justice Chandrachud stated that there are two separate judgments, one authored by him and the other by Justice Sanjiv Khanna, both reaching a unanimous conclusion. The court emphasized that political parties play a vital role in the electoral process, and information about their funding is essential for making informed electoral choices.

Electoral Bond Scheme Overview

The Electoral Bond scheme allows any Indian citizen or entity incorporated in the country to purchase electoral bonds, either individually or jointly. Only political parties registered under Section 29A of the Representation of the People Act, 1951, and securing at least 1% of the votes in the last Lok Sabha or state legislative assembly elections are eligible to receive these bonds. Encashment is permitted only through an authorized bank account.

Background and Apex Court’s Stand

In April 2019, the Supreme Court declined to stay the electoral bonds scheme, emphasizing the importance of an in-depth hearing due to weighty issues raised by the Centre and the Election Commission. The Constitution bench, comprising Justices Sanjiv Khanna, B R Gavai, J B Pardiwala, and Manoj Misra, commenced hearings on October 31, 2022. The court highlighted the necessity of reducing the cash component in the electoral process during the proceedings.

Key Parties Involved

Several petitions challenging the scheme were filed, including those by Congress leader Jaya Thakur, the Communist Party of India (Marxist), and the NGO Association for Democratic Reforms (ADR). The verdict underscores the court’s commitment to addressing concerns related to the sanctity of the electoral process in the country.

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