Professional Documents
Culture Documents
Electoral Bonds
Electoral Bonds
Electoral Bonds
drishtiias.com/printpdf/electoral-bonds
(The editorial is based on the article “Bonds of secrecy” which appeared in The Indian Express for
3rd April 2019. In this editorial we’ll go through the biggest criticisms of the ‘electoral bonds’
system.)
“Concealing the identity of donors in electoral bonds goes against a fundamental tenet of
democracy — transparency. Any executive Act which takes away transparency is anti-democratic
and against the public interest.”
Elections are run with money as much as anything else. This involvement of money in our
elections has become a bane to our democracy. Transparency on the flow of money into our
elections had always been a key issue and the ‘electoral bond’ system was supposed to take
care of this. Sadly, as pointed out in this editorial, this system is deeply flawed and what is
worse is that it can actually make the involvement of money in our elections more opaque.
The notification issued by the Department of Economic Affairs of the Ministry of Finance on
January 2, 2018, gives us details of these bonds. From it, one gets a clear idea of the
objective of these bonds:
The details of the electoral bonds were notified by the finance ministry in January 2018.
Para 7(4) of this notification points out, “Confidentiality of the information furnished by the
buyer shall not be disclosed to any authority for any purpose.”
This notification was issued under Section 31(3) of the Reserve Bank of India Act, 1924.
This Section does not give any details about the electoral bonds policy. The
confidentiality of the bonds and the total prohibition of disclosure of
information about the donor, to any authority for any purpose, is a matter of
legislative policy.
This cannot be dealt with through a notification, which is a subordinate legislation.
Subordinate legislation can only deal with the details of the implementation of the
policy contained in the parent Act. It is the Act which should contain the policy, not the
notification issued by the executive under the Act.
2/3
The Supreme Court has struck down many such orders, regulations, and
notifications on the ground of being ultra vires the parent Act. January 2, 2018,
notification on electoral bonds is ultra vires Section 31(3) of the Reserve Bank of
India Act, 1924, and hence is illegal.
3/3