In striking down the electoral bonds scheme as ‘unconstitutional’, it has restored people’s faith in the world’s largest democracy

The recent judgment of a Constitution bench of the Supreme Court (SC) on the issue of electoral bonds (EB) seems historic and should be welcomed as it can help in expanding the frontiers of free and fair elections. In Association of Democratic Reforms (ADR) vs UOI, the Court struck down the Union’s 2018 EB scheme, describing it as unconstitutional. The Bench held that the scheme violated the voters’ right to information enshrined in Article 19(1)(a) of the Constitution. The Court also struck down the amendments made to the Income Tax Act and the Representation of the People Act, which enabled such anonymous political contributions.

This ruling is highly significant in the SC’s history for many reasons. It represents a rare instance of the Court taking the extreme step of rejecting almost every argument of the government to declare the EB scheme altogether unconstitutional. However, what’s most uplifting about the judgment is that it expanded, with transparency and accountability in mind, the scope of the right to information under Article 19(1)(a) of the Constitution. This will further strengthen the freedom of the citizens to exercise their right to vote more responsibly. As CJI DY Chandrachud has rightly highlighted, “information about funding of political parties is essential for the effective exercise of the choice of voting”.

With this judgment, the SC has struck a blow against the non-disclosure of the source of political funding which promotes corruption, and a culture of quid pro quo with the ruling party. It observed that political contributions by corporates and wealthy individuals, different from donors with fewer resources, give a “seat at the table” or enhanced access to legislators to the former who can influence the government’s decision regarding policy-making and allocation of licences. The court expounded the proportionality standard to resolve the conflict between the two competing fundamental rights, that is, the right to information and the donor’s right to informational privacy. Crucially, the Bench dismissed the government’s defence of curbing black money, stating that it did not adopt the least restrictive measure to achieve its objective and found it unjustifiable to encroach on fundamental rights. Notably, courts in the past have used the collective or the public interest doctrine to resolve such conflicts, before they brought in the single and double proportionality standards.

A look at the history of the “living” Constitution of India will bring to light the ever-expanding justiciable dimensions of the integrity of the electoral process. The landmark verdict in Indira Nehru Gandhi vs Raj Narain (1975) had for the first time recognised “free and fair elections” as a core feature of democracy which forms the basic structure of the Constitution. However, the Election Commission of India (along with its agencies) and the candidates were then seen as the sole “actors” responsible for orderly polling. The mandate was limited to preventing the use of unfair means on polling day and a fair adjudication of election disputes thereafter. The functioning of political parties before the elections was never contemplated as something which could be regulated by a legal fiat.

Subsequently, this paradigm saw a shift with the introduction of the Model Code of Conduct (MCC) and its strict enforcement and judicial recognition in the 1990s. Now, the political parties and their workers could also be sanctioned for electoral malpractices occurring between the announcement of polling dates and the declaration of results. The last two decades have seen a further burgeoning of the scope of judicial review vis-à-vis free and fair elections as a result of rulings such as UOI vs ADR (2002). By recognising that information regarding candidates’ financial status and criminal antecedents is vital for an informed choice by the voter, the SC made it clear that disclosure of the background of candidates and their conduct, not just during the imposition of the MCC but even years before that, is relevant to the electoral process.

While widening the ambit of judicial oversight, the SC has now ruled that not only the sources of income of candidates but also those of political parties can be subjected to mandatory disclosure in the interest of democratic values of transparency and accountability in public affairs. This trend must continue to ensure responsible conduct of financial affairs by political parties, not just at the time of elections but throughout.

In the EB case, the SC has brought out the “underlying dichotomy in the legal regime” which limits the amount of electoral expenditure by each candidate (under Rule 90 of the Conduct of Election Rules 1961) while not requiring disclosure of the donations made to him. On the other hand, electoral funding of political parties is regulated but not their expenditure. The amount spent by politicians on their campaigns is as significant as information on their source since nefarious means can be used to win elections. Thousands of crores of rupees donated by the public (as highlighted in Justice Khanna’s concurring opinion) must not go unaccounted for in a transparent electoral process.

Mandating political parties to publish electoral expenses under different heads such as transport expenses, social media management, cost of rallies, hiring of professional campaign managers, etc. will not only encourage reasonable spending by political parties but will also impose a check on illicit expenses such as the distribution of money and freebies, influencing mainstream media and engaging agencies like Cambridge Analytica for misusing social media algorithms to manipulate electoral choices through disinformation.

This landmark judgment has defended the Constitution’s ideals of participative democracy by prescribing the contours for legitimate electoral reforms and proscribing any misadventure by the legislature. Contributing to the jurisprudence on free and fair polls with an enhanced and rare clarity, it has restored people’s faith in the world’s largest democracy.