Professional Documents
Culture Documents
Incurring of Election Expenditure in Excss of Prescribe Limits
Incurring of Election Expenditure in Excss of Prescribe Limits
PRESCRIBE LIMIT
CHAPTER -1
INTRODUCTION
Election Laws, Practice and Procedure if we look around and compare the
record of its democratic functioning with that of the other
nations who also got freedom from foreign rule more or less around the
same time.
1
Democracy is one of the inalienable basic features of the Constitution of
India and forms part of its basic structure.1
Democracy is government by the people. It is a continual participative
operation, not a cataclysmic, periodic exercise. The little man, in his
multitude, marking his vote at the poll does a social audit of his
Parliament plus political choice of his proxy. Although the full flower of
participative government rarely blossoms, the minimum credential of
popular government is appeal to the people after every term for a
renewal of confidence. So we have adult franchise and general elections
as constitutional compulsions.2
The concept of democracy as visualised by the Constitution presupposes
the representation of the people in Parliament and state legislatures by
the method of election.3
CHAPTER-2
1
Kesavanand Bharati vs State of Kerala AIR 1973 SC 1461.
2
Mohinder Singh Gill and Anor v Chief Election Commissioner and Ors
AIR 1978 SC 851.
3
NP Ponnusivami v Returning Officer, Namakkal AIR 1952 SC 64
2
men and nobles in their decision-making, like the present council of
ministers.
The nature of franchise for election to the popular assemblies is not fully
known. While in the aristocratic republics, the basis appears to have been
a family, in other states, all adult male persons, who were not otherwise
disqualified, appear to have had the right to vote. By naturalisation, even
foreigners could become citizens, and acquire the right of vote.
3
A vote was known as 'chhanda' which literally means a 'wish'. This
expressive term was used to convey the idea that by voting a member
was expressing his free will and choice. We also find description of the
methods of collection of votes of citizens who could not be present at the
meeting of the assembly. For purposes of voting in the assembly, there
used to be multi-coloured voting tickets, called 'shalakas (pins). These
were distributed to members when a division was called and were
collected by a special officer of the assembly, known as "shalaka grahak'
(collector of pins). This officer was appointed by the assembly as a whole.
It was his duty to take the vote which could be either secret or open.
Even after the republican states were absorbed within empires, the
system of
regulating the local corporate life through popular assemblies survived for
a very long time. Almost every imperial conqueror left the conquered
states and communities to carry on their administrative and social system
in their own way as before. During the Muslim period, the affairs of the
trade corporations and the villages continued to be carried on by popular
assemblies. A fundamental change came with the British administration
when revenue, judicial and legal affairs were centralised and conducted
away from the villages. This factor, coupled with the consequent decay of
4
the agricultural and industrial economy of the countryside, resulted in the
deterioration of the corporate life of the rural communities and gradually
the organisations based on the popular will faded out.
4
The first House of the People was duly constituted on 2 April 1952 and
the Council of States was constituted on 3 April 1952.
5
constituted in April 1952, on the basis of the first general elections held
under the Constitution between October 1951 and March 1952. Dr
Rajendra Prasad also entered upon his office as interim President of India
on 26 January 1950 and functioned in that capacity till he entered upon
his office as the first regularly elected President of India on 13 May 1952.
India, that is Bharat, is a union of states (art (1)]. Originally, the states
forming the Indian union were divided into three categories-the erstwhile
nine British Provinces of Assam, Bihar, Bombay, Madhya Pradesh, Madras,
Orissa, Punjab, Uttar Pradesh and West Bengal were categorised as Part A
states, eight bigger princely states or union of such states which
federated into the Indian union, viz, Hyderabad, Jammu and Kashmir,
Madhya Bharat, Mysore. Patiala and East Punjab States Union, Rajasthan,
Saurashtra and Travancore-Cochin were classified as Part B States, and
some smaller princely states and the erstwhile Chief Commissioners'
provinces were constituted into 10 Part C states, viz, Ajmer, Bhopal,
Bilaspur, Coorg, Delhi, Himachal Pradesh, Kutch, Manipur, Tripura and
Yindhya Pradesh. Subsequently, the distinction amongst the Part A, Part B
and Part C states was done away with on their reorganisation in 1956
under the Constitution (Seventh Amendment) Act 1956. On such
reorganisation, the political map of India got divided into 14 states and six
union territories (centrally administered areas). Thereafter, there have
been several reorganisations of these states and union territories :trom
time to time. At present, there are 25 states and seven union territories in
India. From November 2000, the number of states shall go up :trom 25 to
28.
All these constituent states, except the State of Jammu and Kashmir, are
governed by the common Constitution, that is, the Constitution of India.
The State of Jammu and Kashmir has, however, a separate Constitution,
6
called the Constitution of Jammu and Kashmir.
7
'universal adult suftrage' as the basic tenet of direct elections to lower
Houses of Parliament and state legislatures, namely, the House of the
People and state legislative assemblies. Articles 327 and 328 empower
Parliament and state legislatures to make laws relating to elections.
Article 329 bars the interference of courts in electoral matters when the
electoral process is on.
CHAPTER-3
8
and state legislatures have been dealt with at length in the following
chapters. In order not to confuse and tax the readers with too many
details relating to elections to panchayati raj institutions, which are
governed by separate state laws of each state concerned, the present
book is mainly confined to the "discussions relating to elections to the
offices of the President and die Vice-President of India and elections to
Parliament and state legislatures only. However, salient features of the
panchayati raj institutions and elections to those bodies have been briefly
discussed in the concluding chapter of this book. Basically, elections to
these institutions of local self-government are also held in the same
manner as elections to the House of the People and state legislative
assemblies, though under different sets of loca11aws.
Any Indian citizen who is registered as a voter and is over 25 years of age is
allowed to contest elections to the Lok Sabha or State Legislative
Assemblies. For the Rajya Sabha the age limit is 30 years.
Every candidate has to make a deposit of Rs. 10,000/- for Lok Sabha election
and 5,000/- for Rajya Sabha or Vidhan Sabha elections, except for candidates
from the Scheduled Castes and Scheduled Tribes who pay half of these
amounts. The deposit is returned if the candidate receives more than one-
sixth of the total number of valid votes polled in the constituency.
Nominations must be supported at least by one registered elector of the
constituency, in the case of a candidate sponsored by a registered Party and
by ten registered electors from the constituency in the case of other
candidates. Returning Officers, appointed by the Election Commission, are
put in charge to receive nominations of candidates in each constituency, and
oversee the formalities of the election.
9
In a number of seats in the Lok Sabha and the Vidhan Sabha, the candidates
can only be from either one of the scheduled castes or scheduled tribes. The
number of these reserved seats is meant to be approximately in proportion
to the number of people from scheduled castes or scheduled tribes in each
state. There are currently 79 seats reserved for the scheduled castes and 41
reserved for the scheduled tribes in the Lok Sabha.
CHAPTER -4
ELECTION EXPENSES
Rules 86-90 (Part VIII) of the Conduct of Election Rules, 1961 deal with
election expenses. The total expenses in connection with an election in
anyone of the Parliamentary constituencies shall not exceed the
10
prescribed maximum.
TABLE5
5
Subs by S.O.1232(E)dated 24th October,2003.(w.e.f.24.10.2003)
11
12
13
Parliamentary Assembly
constituency constituency
1 2 3 4
Stat Rs Rs
e
1 Andhra Pradesh 2500000 1000000
2 Arunachal Pradesh 1700000 600000
3 Assam 2500000 1000000
4 Bihar 2500000 1000000
5 Goa 1400000 500000
6 Gujarat 2500000 1000000
7 Haryana 2500000 1000000
8 Himachal Pradesh 2500000 700000
9 Jammu and Kashmir 2500000 ----------
10 Karnataka 2500000 1000000
11 Kerala 2500000 1000000
12 Madhya Pradesh 2500000 1000000
13 Maharashtra 2500000 1000000
14 Manipur 2200000 500000
15 Meghalaya 2200000 500000
16 Mizoram 2000000 500000
17 Nagaland 2500000 500000
18 Orissa 2500000 1000000
19 Punjab 2500000 1000000
20 Rajasthan 2500000 1000000
21 Sikkim 1700000 500000
22 Tamil nadu 2500000 1000000
23 Tripura 2500000 1000000
24 Uttar Pradesh 2500000 1000000
25 West Bengal 2500000 1000000
26 Chhattisgarh 2500000 1000000
27 Uttaranchal 2500000 700000
28 Jharkhand 2500000 1000000
2
Unio
n
Terri
torie
s
1 Andaman & Nicobar islands 1700000 ------------
2 Chandigarh 1400000 -------------
3 Dadra and nagar havely 1000000 --------------
4 Daman and diu 14
1000000 ----------------
5 Delhi 2500000 900000
6 Lakshadweep 600000 ------------
7 Pondicherry 2000000 500000
Particulars:
According to the Conduct of Election Rules, 1961 the account of election
expenses is to contain the following particulars in respect of each item of
expenditure from day- to-day, namely:
15
which vouchers have not been obtained.
Every contesting candidate shall, within thirty days from the date of
election of the returned candidate lodge with the District Election Officer
an account of his election expenses which shall be a true copy of the
account kept by him or by his election agent.
Reference to the Election Officer shall, in relation to a constituency in a
Union Territory, be construed as a reference to the Returning Officer for
the constituency. (Section 78, Act 1951)
If the District Election Officer is of the opinion that the account of election
expenses of any candidate has not been lodged in the manner required
by the Act of 1951 and the Rules he share with every such report send to
the Election Commission the account of the election expenses of the
candidate with the vouchers lodged along with it. The District Election
Officer shall publish a copy of the report by fixing the same to his Notice
Board. [Rules 89(1), 89(2), 89(3), Rules of 1981].
16
Commission's guidelines regarding maintenance of
account of expenses and inspection thereof:
17
by the contesting candidates only once in three days.
18
maintained in the correct chronological order along with the aforesaid
register as prescribed under rule 86 of the Conduct of Election Rules
1961.
6. The District Election Officer and the Election Observer shall prepare a
schedule of inspection whereby a three-day cycle of furnishing of
accounts will be set for every candidate in such a manner that on each
day, accounts of one or more contesting candidates are made available
for scrutiny to the concerned officers. In other words, the turn of a
candidate to furnish his accounts for scrutiny will fall after very third day
throughout the period between the filing of his nomination and
declaration of results.
19
to payment of usual copying charges.
The Commission vide Order No. 76/2oo3/JS.II, dated 2.1.2004 has stated
that every contesting candidate at an election shall, within 30 days from
the date of the election of the returned candidate, lodge with the District
Election Officer an account of his election expenses which shall be a true
copy of the account kept by him or his election agent under Section 77 of
the Representation of People Act, 1951. Rule 89 of the Conduct of Election
Rules, 1961 prescribes the manner in which accounts of the candidate
shall be lodged and the steps to be taken by the District Election Officer
consequent upon the lodging of the account of election expenses by the
candidate.
20
as prescribed by the Commission in tenus of its instructions dated
29.10.2003.
(b) The dates on which the accounts were furnished by such candidates
during the course of the elections, and if not furnished, whether notices
for non- compliance of the instructions of the Commission were issued to
them and further follow-up action taken, if any.
(c) The discrepancies noticed by the District Election Officers/ Returning
Officers/designated Officers in the accounts submitted every third day by
the candidate with the actual expenditure noted/assessed by the District
Election Officer/ Returning Officer/Election Observer/designated Officer
and specifically mentioning the items of expenditure which in the opinion
of District Election Officer/Returning Officer/ Observer, have been
suppressed.
(d) Comments of the District Election Officer on the overall final accounts
furnished by the candidates in tenus of actual expenditure incurred by
each candidate. In giving his final comments, the District Election Officer
shall taken into account the observations made by the Election Observers
and any other candidate or by any other organizations or member of the
general public on the daily accounts exhibited on the notice board of the
Returning Officer as required under the directions at para 7 of the
Commission's instructions dated 29.10.2003. These shall be submitted as
annexures to the report that is submitted by the District Election Officer in
the profonna (Annexure'XXXVIII) prescribed in para 11.1 of Chapter XVII of
the Handbook of Returning Officers (all elections where EVMs are used),
1998 edition. In the 'Remarks' column of the profonna, the annexure
number under which the comments of the DEO pertaining to a candidate
shall be mentioned.
21
preceding paragraph the Election Commission shall consider the same
and decide whether any contesting candidate has failed to lodge the
account of election expenses within the time limit and in the manner
required by the Act and the Rules. If the Election Commission decides that
a contesting candidate has failed to lodge his account of election
expenses within the time and in the manner required by the Act and the
Rules, it shall, by notice in writing, call upon the candidate to show cause
why he should not be disqualified under Section 10-A of the Act of 1951.
The contesting candidate, who has been called upon by notice to show
cause, may, within 20 days of the receipt of such notice, submit in respect
of the matter a represenltation in writing to a Election Commission and
shall at the same time and send to the District Election Officer a copy of
his representation, together with a complete account of his election
expenses if he had not already furnished such an account.
The District Election Officer then, within 5 days of the receipt of such
representation and accounts, shall forward to the Election Commission
the copy of the representation and the account, if any, with such
comments as he wishes to make thereon. If the Election Commission is
satisfied, after considering the representation submitted by the candidate
and the comments made by the District Election Officer and after such
enquiry as it thinks fit, that the candidate has no good reason or
justification for his failure to lodge his accounts, it shall declare him to be
disqualified under Section lO- A of the Act, 1951 for a period of three
years from the date of the order and cause the order to be published in
the Official Gazette. (Rule 89(4) to Rule 89(8), Rules of 1961).
The procedure set-out above has been given in some detail here to
apprise the contesting candidates and especially the returned candidates
of the serious consequences of not maintaining the election expenses and
lodging the same in time and in the manner provided in the Act of 1951
and the Conduct of Election Rules, 1961.
22
Where a candidate fails to submit account of election expenses in
prescribed form and time, he automatically incurs disqualification and it is
not necessary for the Election Commission to afford reasonable
opportunity to the candidate before passing order of disqualification, nor
is it necessary to pass reasoned order. There is no question of imposition
of any punishment or stigma on the basis of any discriplinary proceedings
against the candidate, as the disqualification contemplated by Section
10A of the Act is a necessary consequence flowing from his failure to
lodge the account of election expenses within the stipulated period and in
the prescribed manner.6
Small Discrepancies:
Small Discrepancies in the accounts do not matter. Rent was incurred for
microphone used during the election. In the return filed by the candidate,
the date of the bill was wrongly mentioned as the date of payment. It was
held that no inference against the candidate could be drawn from this
discrepancy. 8
23
whether the election expenses exceeded the prescribed limit.
In the above case, it was held, that where the allegation is that the
candidate incurred expenses on petrol during election and the jeep used
by him was bearing the No. NLM 194, the evidence must show that petrol
was sold for a vehicle bearing that number, Nongomban Iboucha Singh, v.
Hisangthem Chandramani Singh, AIR 1977 SC 682.
CHAPTER-5
"INCURRING OF EXCESSIVE EXPENDITURE BY
CANDIDATES AND MAINTENANCE OF ACCOUNTS BY
POLITICAL PARTIES" ...
DEFINITION
Corrupt practice of incurring excessive expenditure is defined in section
123(6). Every candidate at an election shall either by himself or by his
election agent keep a separate and correct account of all expenditure in
connection with the election incurred or authorised by him or by his
election agent between the date of publication of the notification calling
the election and the date of declaration of the result thereof, both days
inclusive. [Section 78 (1), Act 1951 and section 123(6)].
24
The maximum amount of election expenditure which may be incurred by
the candidates for the Parliamentary and Assembly Constituencies in the
various states is laid down in Conduct of Election Rules, 1961. (Rule 90,
Rules of 1961). .
Mere non-disclosure of expenditure is not a corrupt practice. It is incurring
of
expenditure in excess of the prescribed amount which is covered by the
corrupt practice defined in section 123(6). Contravention of Section 77,
sub-section (1) and (2) or failure to maintain correct accounts with the
prescribed particulars does not fall within section 123(6).9
9
Dal ChandJainv. Narain Shanker Trivedi, 1969 DEC 129; Gajanan Krishnaji Bapatv: Dattaji
Raghobaji Meghe, (1995) 5 SCC 347: AIR 1995 SC 2284.
25
no case affect, and much less materially, the result of the election. Where
the main averment in the election petition was that expenditure thereby
incurred had not been included in the statement of accounts as submitted
to the District Election Officer as required under section 77 of the Act and
Rules 86 and 90 of the Conduct of Election Rules 1961, the court held the
candidate was not guilty of corrupt practice under section 123(6).10
26
of the returned candidate or his election agent. Megh Raj Patoqia v. R.K.
Birla, AIR 1971 SC 1295; the following cases were relied (upon, Ranan
Jaya Singh v. Bay Nath Singh, AIR 1954 SC 749 = 1955 SCR 671;
RamDayalv. Brijraj Singh, AIR 1970 SC 110; Mubarak Mazdoor v. Lai
Bahadur, 20 ELR 176.
27
returned candidate, it would be immaterial as to who actually made the
payments, which ought to have been included in the return of election
expense. It is not "whose hand it is that spends the money". The essence
of the matter is "whose money it is" that has been spent. In order that
Explanation 1 to Section 77 of the Act may apply, therefore, it must be
proved that the source of the expenditure incurred was not out of the
money of the candidate or his election agent. Gajanan Krishnaji Bapat v.
Dattaji Raghobaji Meghe, (1995) 5 see 347: AIR 1995 se 2284.
28
EXPENDITURE BY PARTY ORGANISATION OR
ASSOCIATION
29
VALIDITY OF EXPLANATION 1
In KarunakarDas v. Union of India, AIR 1984 Ori. 174, the High Court of
Orissa, following the Indira Nehru Gandhi, case upheld the
constitutional validity of the Explanation appended to section 77 by
1974 Amendment. The issue of constitutional validity of Explanation 1
added to section 77(1) of 1951 Act came up again before* the
Supreme Court in Dr. P. Nalla Thampy v. Union of India, AIR 1985 SC
1133 : 1985 (Supp.) SCC 189. A five-judge constitutional Bench led by
Y.V. Chandrachud, C.J, examined the whole issue de novo and upheld
its constitutionality.
30
This argument was met by the Supreme Court by pointing out that
section 77(1) and Explanation 1 deal with two different aspects. The
former deals with the expenditure 'incurred or authorised by' a
candidate or his election agent in connection with the election;
whereas the latter deals with the expenditure incurred or authorised by
a political party or any other association or body of persons or an
individual other than the candidate or his election agent. Lest the
expenditure of the kind described in explanation 1 should be deemed
to be incurred or authorised by the candidate or his election agent, the
provision in the explanation is specifically made to mean that it shall
not be so deemed. In view of this express provision, the court held that
"the latter (namely, explanation 1) cannot render the former [namely,
section 77(1)] meaningless. "
31
by the candidate or his election agent? The Supreme Court in Dr. P.
Nalla Thampy has answered this situation by stating categorically that
"Explanation 1 will not be attracted." In its view it is only if the
expenditure is in fact incurred or authorised by a political party or any
other association or body of persons, or by an individual (other than
the candidate or his election agent) the explanation 1 will come into
play. The candidate cannot be allowed to place his own funds in the
power or possession of a political party, or a trade union or some other
person and then plead for the protection of explanation 1. That would
only be "a mere facade," or a subterfuge for evading the restraint
imposed by section 77(1). In reality, the expenditure is incurred by the
candidate himself because the money is his. According to the court,
the deciphering distinction is:
Thus, in order that Explanation 1 may apply, it must be proved that the
source of the expenditure incurred was not the candidate or his
election agent.
32
Court, which was delivered on
3rd October, 1974. Chawla made a petition to the President under
section 8-A of the Act of 1951 for removal of his disqualification on a
number of grounds, pointing out the discrepancies in the judgment of
the Supreme Court. The Election Commission heard arguments and
gave its opinion, recommending removal of the disqualification for the
unexpired portion of the period of six years. The President accepted
the opinion and the recommendation of the Election Commission, and
passed an order removing the disqualification; vide Government of
India Gazette Extraordinary, bearing the date May 19, 1976.
33
that society or organisation canvass for the candidate, such
association or society and every member of r.uch society would be an
agent of the candidate and the expenses incurred by them should be
included in the return of election expenses. Amir Chand v. Surendra
Lai Jha, 10 ELR 57.
Payments made to the party for party ticket and for general expenses
of the party's elections fund do not form part of the election expenses
of a candidate. Shiva Dass v. Sheikh Mohd Abdul Samad, 8 ELR 265.
In one case, the Supreme Court had occasion to deal with the question
whether the expenses incurred by a political party to advance the
prospects of the candidates put up by it fell within section 77, Act
1951. The Supreme Court observed; "this Court as well as the High
Courts have taken the view that the expenses incurred by a political
party to advance the prospects of the candidate to be put up by it,
without more, do not fall within the meaning of Section 77." Megh Raj
Patodia v. RK. Birla and others, AIR 1971 SC 1295.
34
376 (SC), Swatantra Party spent Rs. 4,000 in the constituency of the
candidate set-up by the party. The contention of the petitioner was
that the expenses incurred by the Swatantra Party were really incurred
by the returned candidate. The Supreme Court expressed the view that
expenses incurred by a political party in respect of its candidates do
not come within the mischief of section 123 (6), read with section 77
Act of 1951.
35
presumed to have been authorised by the candidate or his election
agent. But the presumption is rebuttable. The candidate shall have to
show that the said expenditure was in fact incurred by a political party
and not by him.
36
candidate/ candidates belonging to the said party. Dr. N.P. Nalla
Thampy Telahv. Union of India and others AIR 1985 SC 1133: 1985
(Supp.) SCC 189 relied. Common Cause a registered Society v. UOI &
Ors, JT 1996 (3) SC 706: (1996) 2 SCC 752.
CHAPTER -6
37
For the purposes of clause (a) of explanation 1 the expression "leaders of
a political party" means - (i) where such political party is a recognised
political party, such persons not exceeding forty in number, and (ii) where
such political party is other than a recognised political party, such person
not exceeding twenty in number, whose names have been communicated
to the Election Commission and the Chief Electoral Officers of the States
by the political party to be the leaders.
CHAPTER-7
EXPENDITURE MUST BE IN CONNECTION WITH THE
ELECTION.
Amount spent for repairs of motor cars need not be shown as election
expenses even though the immediate object of the repairs was for using
the car for election purposes.
38
11
11
M.R. Meganathan v. K.T. Kosal Ram, 9 ELR 242.
12
Amir Chand v. Surendra Lai Jha, 10 ELR 57.
13
S. Khadar Sheriffv. Munuswami Gounder, (1955) 2 SCR 469; 283: 7 ELR 301. 15 K.C.
Sharmav. Rishab Kumar, 20 ELR 401 : AIR 1960 MP 27.
14
K.C.Sheriff V.Munuswami Gounder
15
Chuni Lai Singh Raguvanshiv. Gajadhar and Others, 1969, DEC 464 SC.
16
AmarNath v. Lakshman Singh and others, 1968 DEC 130 SC.
39
CHAPTER-8
Section 77 gives the period for which the election expenses are to be
entered in a separate account. It is between the date of publication of the
notification calling the election and the date of declaration of the result
thereof, both days being inclusive, [section 77(1), Act 1951].
Under the law as it stood just prior to the amending Act 27 of 1956,
17
Shivrama Sawnt Bhonsale v. Pratap Rao Deo Rao Bhonsale, 17 ELR 37.
40
no such starting point or ending date were prescribed. The words used
were expenses incurred by "the candidate". This expression gave rise to
controversy in number of cases as to when a person is deemed to be a
candidate. The Supreme Court held in the case S. Khadar Sheriffv.
Munuswami Gounder (1955) 2 SCR 496; AIR 1955 SC 775, that the exact
point and time from which a candidate must be deemed to be a candidate
is the time when, with the election in prospect, he himself decides leaving
no manner of doubt as to his intention.
The amended section 77 has removed the difficulty of proving by
evidence the time from which a person became the prospective candidate
all who has provided a point of time which can be established without
controversy by the production of the notification calling the election.
The legislature by prescribing the inner and the outer limits in Section
77 of the R.P. Act intended the elimination of money influence during the
elections and maintaining of purity of elections. The expenditure incurred
after the declaration of the result of the election can possibly have no
nexus with the purity of the electoral process. The very fact that the
advertisements thanked the electorate for electing a candidate would
show that the same could only have been issued for publication after the
declaration of the candidate as the returned candidate. The expenditure
incurred in that connection therefore cannot be said to be an expenditure
'authorised' or 'incurred' during the prohibited dates. Indeed, there may
be cases where some expenditure can be incurred or authorised by a
returned candidate in connection with his election, even after the
declaration of the result, but unless that expenditure can be related to the
process of election, authorised or incurred during the prohibitory limits set
out in Section 77 { 1) of the Act, it is not required to be included in the
return of expenses. The mere fact that the advertisements appeared in
the newspapers on the very next day of declaring the result cannot lead
to any presumption that the expenditure in connection there with had
been incurred or authorised by the returned candidate during the
41
prescribed prohibitory dates in anticipation of his being declared elected.
18
CHAPTER-9
BURDEN OF PROOF OF EXCESSIVE EXPENDITURE.
In the instant case the Supreme Court has held that-under the
circumstances of the case it stands established that the appellant
returned candidate had used two vehicles.
From this, the necessary conclusion is that he did not specify in his
expenditure return
that he used the said vehicle and the expenditure incurred towards that
vehicle. Thus he deliberately suppressed the material fact of the user of
the vehicle and the expenditure incurred for its use. What expenditure he
had incurred for the use of the vehicle can be inferred from proved fact.
Had the appellant gone into the witness box and examined himself as a
witness, he would have been subjected to cross- examination of his actual
total expenditure. Moreover even though notice was issued to produce his
account deliberately with held its production. For these facts the High
Court has reasonably arrived at the finding that had he produced the
account, the expenditure would have been shown to be in excess of the
limit prescribed under the Act. An adverse inference was drawn from the
omission to produce the account that, the appellant had committed
corrupt practice under S. 123 (6) of the Act. This conclusion on the basis
of the evidence on record, cannot be said to be vitiated by any error of
law.
42
the exclusive knowledge and custody of
the returned candidate or other person. Under Section 77, it is for the
candidate election agent to maintain a regular account of the expenditure
incurred in connection with the election and statement in that behalf is
required to be filed before the collector. In this case the respondent
election petitioner had issued a notice to the appellant-returned candidate
calling upon him to produce the expenditure account which he did not
produce.19
CHAPTER-10
MAINTENANCE OF AUDITED ACCOUNTS AND FILING OF
RETURN OF INCOME BY POLITICAL PARTIES -
MANDATORY.
The provision of Section 13A of Income-Tax Act, 1961 read with Section
293A of the Companies 'Act, 1961 clearly indicate the legislative scheme
the object of which is to ensure that there is transparency in the process
of fund-collecting and incurring expenditure by the political parties. The
requirement of maintaining audited accounts by the political parties is
mandatory and has to be strictly enforced.
Under provisions of sections 139 (4B), 142 (1) and 276CC of the Income-
tax Act,
1961 the political parties, are under a statutory obligation to furnish a
return of income for each assessment year. To be eligible for exemption
from income-tax they have to maintain audited accounts and comply with
the other conditions envisaged under Section 13A of the Income-tax Act.
Sub-section (4B) of Sec. 139 of LT. Act makes it obligatory for the Chief
Executive Officer of every political party to furnish a return of income for
each year in accordance with the provisions of the I. T Act. Sec. 142 (1)
19
R. Puthunainar Alhithan v. P.H. Pandian (1996) 3 SCC 624: AIR 1996 SC 1599.
43
provides for inquiry before assessment. Failure to furnish a return of
income has been made a criminal offence punishable under Section 276
CC of the LT. Act. It leaves no leeway. The mandatory provisions of the
law have to be enforced.20
20
Common Couse a Registered Society v. Union ofIndia & others, JT 1996 (3) SCC
706 : (1996) 2 SCC 752
44
there from;
CHAPTER-11
45
the hard reality that for contesting an election one needs large
amounts of money. The limits of expenditure prescribed are
meaningless and almost never adhered to. As a result, it becomes
difficult for the good and the honest to enter legislatures. It also
creates a high degree of compulsion for corruption in the political
arena. This has progressively polluted the entire system. Corruption,
because it erodes performance, becomes one of the leading reasons
for non-performance and compromised governance in the country. The
sources of some of the election funds are believed to be unaccounted
criminal money in return for protection, unaccounted funds from
business groups who expect a high return on this investment,
kickbacks or commissions on contracts etc. No matter how we look at
it, citizens are directly affected because apart from compromised
governance, the huge money spent on elections pushes up the cost of
everything in the country. It also leads to unbridled corruption and the
consequences of wide spread corruption are even more serious than
many imagine. Electoral compulsions for funds become the foundation
of the whole super structure of col11}ption.
46
A reasonable level reflecting the increasing costs. However, this
ceiling should be fixed by the Election Commission from time to time
and should include all the expenses by the candidate as well as by his
political party or his mends and his well- wishers and any other
expenses incurred in any political activity on behalf of the candidate by
an individual or a corporate entity. Such a provision should be the part
of a legislation regulating political funding in India. The Commission
recommends that Explanation 1 to section 77(1) of the Representation
of the People Act, 1951 should be deleted.
47
strongly.
All candidates should be required under law to declare their assets and
liabilities by an affidavit and the details so given by them should be made
public.
48
law for the purpose. Again, the legislators should be required under law
for the purpose. Again, the legislators should be required under law to
submit their returns about their liabilities every year and a final statement
in this regard at the end of their term of office.
CHAPTER-12
ELECTORAL REFORMS
49
• Indirect public funding to candidates of recognized political
parties - including free supply of electoral rolls (already in
vogue), and such items by the Election Commission as are
decided in consultation with the Union government.
(1) Notwithstanding anything contained in any other law for the time
being in force, the Election Commission shall, on the basis of the past
performance of a political party, during elections, allocate equitable
sharing of time on the cable television network and other electronic media
in such manner as may be prescribed to display or propagate any election
matter or to address public in connection with an election
50
till forty-eight hours before the hour fixed for poll for such election.
(3) The allocation of equitable sharing of time under sub-section (1) shall
be binding on all political parties concerned.
(4) The Election Commission may, for the purposes of this section, make
code of conduct for cable operators and electronic media and the cable
operators and every1 person managing or responsible for the
management of the electronic media shall abide by such code of conduct.
Explanation.- For the purposes of this section,-
(i) "electronic media" includes radio and any other broadcasting media
notified by the Central Government in the Official Gazette;
(ii) "cable television network", and "cable operator" have the meanings
respectively assigned to them under the Cable Television Networks
(Regulation) Act, 1995 (7 of 1995).'.
51
Such an exciting debate format will not only prove to be extremely
popular, but it will also change the nature of politics and electoral
contests overtime. Costs of electioneering will be brought down
dramatically, informed choices will be encouraged, and competent
candidates with leadership qualities and parties with sound ideas will
have better chance of being elected.
Assuming that there are 5 major parties with a plurality of vote shared between
them - let us say parties A, B, C, D and E secured 35%, 30%, 20%, 10% and 5%
votes in the previous election. Let us say that the party with the least vote share
Both the donor and recipient shall be obliged to make full disclosure to the
Election Commission and the Income Tax authorities. Penalty for non-disclosure
or false disclosure shall be:
For Donors: fine equal to ten times the contributions and imprisonment for six
months.
For Candidates: disqualification for six years, fine equivalent to ten times the
amount not disclosed, and imprisonment for at least one year.
52
For Parties: de-recognition and de-registration for five years, fine equivalent to
ten times the amount not disclosed, and imprisonment of office bearers for three
years.
The third, and critical issue relates to public funding. The law enacted in
September 2003 is silent on public funding. The NCMP is committed to providing
public funding
for elections.
Public funding should be considered only after other funding reforms are
in place, and after parties are democratised and regulated. Any public
funding to be successful should be limited, fair, transparent, verifiable and
non-discretionary.
The following model could be considered for public funding. This model is
based on a careful study of comparative international experience. The
objectives of public funding are: provide parties with the necessary
resources to effectively participate in normal political activity; and to
provide support by way of reimbursement of costs of electioneering.
However, we have a system of raising resources from private sources,
and election expenditure ceilings mandated by law.
53
• Party candidates to be democratically selected by
secret ballot by
• Decriminalization of politics
• Transparent
• Verifiable
• Non-Discretionary
54
• Encourage private resource mobilization
• Prevent fragmentation
CHAPTER-13
CONCLUSION
55
booths can very conveniently be curbed by making necessary provisions
in law. There does exist some legal mechanism in these areas and what is
needed is better enforcement of the provisions so made.
With a view to reducing election costs and strain on human and other
resources, State and Parliamentary level elections, to the extent possible,
should be held at the same time.
56
• The election code of conduct which should come
into operation as soon as the elections are
announced should be given the sanctity of law
and its violation should attract penal action.
BIBLIOGRAPHY
INTERNET:
1) http//www.google.com/election commission of india/ppl file
(visited on 22nd May,2008).
57
2) www.Election Commission India.htm
BOOKS:
Procedure Practice.
JOURNAL
58