Electoral Bonds will promote transparency, accountability, Centre tells SC

Defending the introduction of Electoral Bonds, the Central Government has claimed that this ‘alternate system’ would promote transparency and accountability in funding and donations received by political parties in India..The averment has been made by the Central Government in its counter affidavit filed in pleas challenging the introduction of Electoral Bonds through Finance Act, 2017 which brought amendments in the Income Tax Act, RBI Act and Representation of People Act..Denying all claims of arbitrariness, discrimination and violation of Fundamental Rights, Centre has stated,.“..in response to the contents of the Writ Petition, it is denied that the Amendments and the Notification seek to create an anonymous and secretive mechanism for increasing the wealth of political parties.”.To the contrary, Centre contends that the scheme “envisages building a transparent system of acquiring bonds with validated KYC and an audit trail”..Explaining the salient features of the Electoral Bonds scheme, Centre has informed that such bonds will be available in multiples of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh or Rs 1 crore, and can be encashed by a political party only through a bank account with the State Bank of India..Also, only those political parties which are registered under Section 29A of the Representation of People’s Act, 1951 and have secured not less than 1 percent of the votes polled in the last general election to the Lok Sabha or the Legislative Assembly, are eligible to receive the bond, Cente has added..Further, the Scheme mandates every political party has to file returns before the Election Commission of India as to how much money has come through these electoral bonds..RBI’s instructions regarding KYC norms of a bank’s customer will apply to buyers of the bond as well and a non-KYC compliant application shall be rejected, Centre has clarified..However, these bonds will not have the name of the donor or the receiving political party and would only carry a unique hidden alphanumeric serial numbers as an in-built security feature..Centre has further submitted that to ensure complete transparency, the buyer of a bond must submit an application in the requisite format, containing PAN, details of identity, address etc. Additionally, the application has to be attested by two witnesses with a declaration of the truthfulness of the contents of the Application..Other notable features of the Electoral bond scheme, as listed by the Centre are:.Payments for the issuance of bonds would be accepted in Indian Rupees.The face value of the bonds would be counted as income by way of voluntary contributions received by an eligible political party, for the purpose of exemption from Income-tax under Section 13A of the Income Tax Act, 1961.The bonds will be available only for a period of 10 days each in the month of January, April, July and October as may be specified by the Central Government. An additional period of thirty days will be specified by the Central Government in the year of General Elections.The bond shall be valid for 15 days from the date of issue and no payment shall be made to any payee political party if the bond is deposited after the expiry of the validity period.Information furnished by the buyer is confidential and will not be disclosed to any authority for any purposes, except when demanded by a competent court or upon registration of a criminal case by any law enforcement agency..Therefore, relying on a plethora of judgments, Centre has urged that court to not substitute its views in policy matters decided by the legislature..With respect to the objection that the Finance Bill, 2017 was wrongly categorized as a Money Bill in terms of Article 110 of the Constitution, Centre has stated that the said issue is pending consideration in another case, titled Kudrat Sandhu vs. Union of India & Anr..Hence, the Centre has prayed that the two cases should either be tagged along or the present case should be kept pending subject to the final outcome in the other case..Bar & Bench is available on WhatsApp. For real-time updates on stories, Click here to subscribe to our WhatsApp.