Govt files fresh affidavit against EC arguments on Electoral Bonds

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Barely a week after the Election Commission of India expressed its reservations to the Centre about the Electoral Bond scheme and informed the Supreme Court of the same, the government has filed a fresh counter affidavitdismissing the EC’s arguments and defending the scheme.

It has also claimed that “contrary to the concerns raised by the Election Commission of India, the amendments in the respective legislation have been made and the Electoral Bond scheme has been introduced as a pioneer step in bringing electoral reforms to ensure that the spirit of transparency and accountability in political finding is maintained”. The counter affidavit filed on Tuesday by the Department of Economic Affairs of the finance ministry has stated that the “electoral bonds is a positive step in the right direction to ensure accountability and transparency in conducting elections”.

“The need to bring about such a change was felt as the measures that existed on the book were either not enough or were proving to be ineffective/insufficient in dealing with corruption in elections”.The Election Commission told the Supreme Court last week that it had conveyed its opposition to anonymous electoral bonds to the law ministry in 2017 itself and termed it a ‘retrogade’ step. The poll panel, in its affidavit before the top court, expressed concern over electoral bonds, non disclosure of donor identity and clauses that may allow for shell companies and foreign entities to fund and influence Indian political parties and elections. The government, however, stated on Tuesday that the anonymity of the donor in case of electoral bonds was “driven by a well thought out policy consideration” and to prevent “political victimisation” of the donor.

So,even as the identity of the donor cannot be disclosed or reported to the EC through a political party’s contribution report, the record of the purchaser are available in the banking record and be accessed by enforcement agencies.

It has also rejected EC’s concerns over the possibility of foreign funding influencing Indian politics through the bonds as ‘without factual or legal merit’. Only domestic companies with a majority stake are permitted to make donations provided there is KYC compliance. This, it is argued by the government ensures backing with an ‘an audit trail in comparison to the earlier opaque system of cash donations’ and hence the bonds ‘attempt at bringing greater transparency’.

The finance ministry has also pointed out that it did consider the concerns raised by the ECI in its communication on March 15, 2017, and the secretary, DEA, had briefed the ECI in September 2017. Further, the affidavit underlines, the EC suggestion on capping anonymous funding at Rs 2,000 instead of Rs 20,000 has been accepted and effected through an amendment in Section 13 A to the Finance Act, 2017.