PIL on political funding: SC asks govt, poll panel to respond

NEW DELHI: The Supreme Court on Tuesday sought the responses of the government and the Election Commission of India (ECI) on a PIL challenging the recent changes in laws on funding of political parties and alleging that these “legitimise electoral corruption”.

A bench comprising Chief Justice Dipak Misra and Justices A M Khanwilkar and D Y Chandrachud issued notice to the Centre and the poll panel on the plea, which also alleged that the changes would bring opacity into Indian politics and open the doors “to unlimited political donations”.

Through the petition, an NGO has challenged the amendments made to the Reserve Bank of India Act, the Representation of the People (RP) Act, the Income Tax Act, the Companies Act and the Foreign Contribution Regulation Act (FCRA) by the Finance Acts of 2016 and 2017.

The NGO, Association for Democratic Reforms (ADR), has claimed in its plea that the amendments have removed the cap on political donations by companies and legalised anonymous donations by introducing the use of electoral bonds which can be issued by any scheduled bank for the purpose of funding any party.

It said that by amending the RP Act, the donations made by way of electoral bonds are exempted from disclosure to the ECI and claimed that this would “adversely affect electoral transparency and encourage corrupt practices in politics”.

The PIL contended that the amendment to the Companies Act has not only removed the earlier cap of 7.5 per cent of a company’s average three-year net profit for political donations, but a corporate entity now is no longer required to name the parties to which they make contributions.