Supreme Court Orders SBI to Disclose Electoral Bond Donors and Political Recipients
The Supreme Court of India, in a landmark ruling, has rejected the State Bank of India’s (SBI) request to delay the disclosure of electoral bond details, reinforcing transparency in political funding. The judgment, delivered in State Bank of India v. Association for Democratic Reforms & Others, mandates SBI to release details of electoral bond purchasers and recipients by March 12, 2024, with the Election Commission publishing the data by March 15, 2024.
Background of the Case
The Electoral Bond Scheme, introduced through the Finance Act, 2017, allowed anonymous donations to political parties. The scheme was challenged in Writ Petition (Civil) No. 880 of 2017 by the Association for Democratic Reforms (ADR), arguing that it violated citizens’ right to information under Article 19(1)(a) of the Constitution. On February 15, 2024, the Supreme Court declared the scheme unconstitutional, ruling that the secrecy surrounding political donations undermined democratic principles.
Petitioner’s Arguments
ADR and other petitioners argued that:
- Right to Information Violation: The scheme’s anonymity denied voters the fundamental right to know the funding sources of political parties.
- Encouragement of Corruption: The absence of donor disclosure enabled illicit political financing and policy manipulation.
- Unequal Political Funding Access: Ruling parties disproportionately benefited, creating an unfair electoral playing field.
- Misuse of Banking Secrecy: SBI, as the sole issuer, maintained details in separate silos, making it difficult to trace transactions.
Respondent’s Arguments
SBI and the Government defended the scheme, asserting:
- Protection of Donor Privacy: The anonymity provision was designed to shield donors from political victimization.
- Encouragement of Legitimate Political Donations: The scheme provided an alternative to cash-based, unaccounted political funding.
- Existence of Regulatory Oversight: RBI and SBI had control mechanisms in place to prevent misuse.
- Technical Challenges in Data Compilation: SBI claimed that donor and recipient details were stored separately and required extensive processing.
Supreme Court’s Observations
Delivering the judgment, Chief Justice Dr. Dhananjaya Y Chandrachud emphasized that SBI had sufficient time to compile the data and that any further delay would undermine the Court’s earlier ruling. The Court stated:
“The non-disclosure of political donations infringes on citizens’ fundamental right to information and undermines democratic accountability. SBI’s obligation is clear; it must comply with the order without delay.”
The Court further ruled:
- Electoral bonds facilitated opacity in political funding: The scheme concealed the nexus between money and politics, enabling corporate influence over policymaking.
- Article 19(1)(a) violation: The absence of disclosure violated citizens’ right to know, a cornerstone of electoral democracy.
- Article 14 breach: Unlimited corporate donations, coupled with anonymity, created arbitrary advantages for ruling parties.
Final Judgment
The Supreme Court issued the following directions:
- Immediate cessation of electoral bonds: SBI must halt issuance of new bonds.
- Disclosure of all past transactions: SBI must submit details of all electoral bonds purchased since April 12, 2019, to the Election Commission.
- Publication of donor information: The Election Commission must upload the full list of donors and recipients on its website by March 15, 2024.
- Return of unredeemed bonds: Any bonds within their validity period must be returned to the purchaser.
Impact of the Judgment
The ruling has far-reaching implications for political transparency and campaign financing:
- End of anonymous corporate donations: The judgment restores transparency by making political funding public.
- Strengthened electoral democracy: Voters can now scrutinize political funding sources before elections.
- New campaign finance laws: The government may need to introduce alternative, constitutionally compliant political funding mechanisms.
Conclusion
This ruling marks a turning point in electoral finance regulation in India. By ensuring transparency in political contributions, the Supreme Court has reinforced democratic accountability and prevented undue corporate influence in governance. The judgment is expected to set a new precedent for election funding reforms in the country.
Petitioner Name: Association for Democratic Reforms.
Respondent Name: State Bank of India.
Judgment By: Justice Dhananjaya Y Chandrachud, Justice Sanjiv Khanna, Justice B.R. Gavai, Justice J.B. Pardiwala, Justice Manoj Misra.
Place Of Incident: India.
Judgment Date: 11-03-2024.
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