On March 26, 2021, A Supreme Court bench led by Chief Justice of India Sharad A. Bobde refused to stay the sale of a new set of electoral bonds, the new set of electoral bonds are scheduled to come out for sale between April 1-10, 2021.
- NGO Association for Democratic Reforms had filed a petition seeking ‘Stay’ on the new set of Electoral Bonds due to upcoming elections in Tamil Nadu, Kerala, Assam, Pondicherry & West Bengal.
- The voting for State elections begin on March 27 & counting of votes will be held on May 2.
- The Electoral Bonds Scheme began in 2018 and continued in 2019 & 2020.
Electoral Bonds Scheme
- It was introduced with the Finance Bill (2017) and notified in 2018 as the ‘Electoral Bond Scheme 2018’.
- It is a financial instrument for making donations to political parties.
- Range of Bonds – INR 1, 000 – INR 1 crore (no maximum limit). The bonds can be purchased either digitally or through cheque.
- State Bank of India (SBI) is the only bank which is authorized to issue these bonds. There is no limit on the number of bonds an individual or company can purchase.
- The Electoral bonds are sold four times a year – January, April, July & October.
- Validity – The bonds donated to political parties must be encashed within 15 days through the party’s verified account, failing which SBI will deposit the amount into Prime Minister’s Relief Fund.
- Eligibility for receiving bonds – Any party registered under section 29A of the Representation of the Peoples Act, 1951 and has secured at least 1% of the votes polled in recent General/Assembly elections are eligible to receive electoral bonds.
Areas of Controversy
- It allows political parties to accept money from donors whose identity is kept anonymous.
- The contributions received by Political Parties in the form of Electoral Bonds scheme will be exempt from Income Tax.
Restrictions done away with the introduction of the Electoral Bond Scheme
- No Foreign company could donate to any political party under the Companies Act.
- A Firm could donate a maximum of 7.5% of its average 3-year net profit as political donations according to Section 182 of the Companies Act.
- Before the introduction of electoral bonds, political parties had to disclose details of all its donors, who have donated more than Rs 20,000.
A total of 12, 924 electoral bonds worth INR 6534.78 Crore have been sold in 15 phases of sale held between March 2018 to January 2021.
Recent Related News:
i.August 13, 2020, A three-judge Bench of Supreme Court (SC) passed a judgement stating that daughters have equal inheritance rights as of sons in the properties of fathers, grandfathers and great-grandfathers right from the codification of the law in 1956
About Election Commission of India (ECI):
Chief Election Commissioner – Sunil Arora
Election Commissioner – Sushil Chandra, Rajiv Kumar
Head Office – New Delhi