New Delhi: In what would mean a closer scrutiny of poll expenses incurred by political parties and candidates, the Election Commission of India (EC) is launching a new division that will be devoted to monitoring such spending as it attempts to check the use of money power in elections.

The division would also examine reports filed by election observers on poll expenditure during the campaign period.

EC has written to the finance ministry to allot a panel of civil servants to staff the unit. A director general (election expenditure monitoring), with a rank equivalent to that of a joint secretary to the government of India, will head the set-up.

The EC move follows a sharp increase in election spending by political parties and candidates over the years. The Centre for Media Studies (CMS), a New Delhi-based research firm, has estimated that such spending amounted to Rs10,000 crore in the April-May general election—more than double what was spent in 2004. CMS estimated that out of this, around a quarter, or Rs2,500 crore, was below-the-line spending by candidates.

Listen to Jagdeep Chhokar, chairman of Association for Democratic Reforms, talk about the need to set up a division for election expenditure monitoring and how effective he thinks it will be

“We are trying to streamline the system so that expenditure control is not just a nominal exercise and we have a permanent machinery to take care of it. This division would be launched soon, hopefully, within a month,” said election commissioner S.Y. Quraishi.

EC places an expenditure ceiling of Rs25 lakh per candidate for Lok Sabha elections and Rs10 lakh for state assembly elections; candidates are required to submit election expense reports thrice during the entire election period.

According to Section 77 of the Representation of the People Act (RPA), 1951, each candidate is required to maintain an account of his/her election expenses and ensure these do not exceed the prescribed limit. Section 78 of RPA states that every contesting candidate shall, within 30 days from the date of declaration of election results, file an account of his/her election expenses with EC.

So far, the autonomous commission, which is responsible for the conduct of elections, has lacked the resources to follow up and scrutinize accounts filed by candidates and political parties. The panel has been delivering the accounts to the Central Board of Direct Taxes (CBDT) for further scrutiny.

“We did not have any machinery to follow up on these expenditure accounts after elections... We used to send these accounts to CBDT, but were not really aware if any scrutiny was actually taking place,” Quraishi said.

With EC now planning to start its own division, the scrutiny process is likely to become more stringent and effective. If it is found that a candidate had defaulted by undervaluing his/her expenses or submitting false accounts, the law permits EC to take action.

According to an EC official in charge of legal matters, who did not want to be identified, Section 10 (A) of RPA states that if it is found that a candidate had mis-stated election expenses, a notice would be sent to him/her and the candidate can be disqualified for three years if found guilty.

Mint could not immediately ascertain whether any candidate has been disqualified in this manner.

According to the law, if the candidate has already been elected by the time the scrutiny is completed, he/she may lose the seat. “The emphasis is always on the winning candidate. However, it is possible that the losing candidates may have also defaulted and with proper scrutiny, we would be able to ascertain that and take action,” Quraishi added.

Activists welcomed the move. “This division certainly can make a difference, but whether or not it does will depend on the implementation,” said Jagdeep Chhokar, founding member of the Association for Democratic Reforms—a non-profit organization working on governmental and electoral reforms.

“Through a detailed and methodical check, one would be able to find legally valid evidence of any violation or misuse by candidates. While there can never be 100% compliance in such matters, even if it can help check blatant misuse (of money power during elections), it would be of great service,” Chhokar said.

Some political parties welcomed the move, but others said just putting in place a monitoring unit is not enough.

“Even if there is transparency, election expenses have become so high that we need serious introspection,” said B.K. Hariprasad, a Congress general secretary and Rajya Sabha member. “We do not mind monitoring by EC, but that does not serve the purpose. If they really want clean and clear elections, they should either have government funding of elections or increase the expenditure ceiling.”

“EC should not only monitor expenses incurred by parties and candidates during election, but also take action against those who violate norms,” said Basudeb Acharia, leader of the Communist Party of India (Marxist) in the Lok Sabha. “There are so many parties, especially the smaller parties, which spend huge amounts of money during campaigning. However, there is no system for monitoring such expenses incurred and hence, EC’s move is welcome.”