This landmark verdict was the culmination of a quest which began three years ago. The Association for Democratic Reforms (ADR), a non-governmental organization, had asked for details of finances, donations and donors from several political parties using the RTI route. All parties flatly refused, saying they were not subject to RTI. Hence, ADR lodged a complaint along with one Subhash Agrawal with CIC, asking that political parties be declared as public authorities. The hearings began. The political parties said they submit expense details to the Election Commission of India, which can, in turn, publicize them through its website (it does not). The parties said they file their returns with the income-tax department. So much of the information sought is in the public domain. Their argument was that an RTI request was forced on them.
ADR countered by arguing that their sources of income are not known and income-tax filings are not made public. More importantly, as elections have become hugely expensive affairs, transparency of campaign finances becomes paramount. Parties come to power through elections and form the government. So keeping financing and donors secret can raise suspicions of quid pro quo. There is potential for conflict of interest. Do large donations make parties vulnerable and captives to special interests? This cannot be known unless the identities of those donating money are disclosed.
ADR also argued on a more specific point: that political parties receive substantial, direct and indirect, funding from the government. First, since both donor and party enjoy 100% tax exemption, it implies that for any Rs.100 donation, the government loses about Rs.53 of tax revenue. The parties also do not pay any income or service tax (even though they raise funds through sale of coupons). Additionally, political parties are given free or subsidized land and bungalows in prime locations in Delhi and other state capitals. They are also given free air time on Doordarshan and All India Radio. So on the basis of section 2 (h) (ii) of the RTI Act, these parties are substantially funded by the state and, hence, should be deemed public authorities.
After several rounds of arguments and counter-arguments, CIC gave its verdict. All the six parties have shown amazing unity and consensus in rejecting the CIC verdict. (It should be remembered that members of CIC rank on a par with justices of the Supreme Court.) Note that India has more than 1,200 political parties and this verdict applies to only six of them. They will now presumably go to courts to overturn the CIC verdict. They say they are already accountable to the Election Commission and now they are being made accountable to CIC. That’s incorrect, because under RTI they become answerable to all citizens of India.
These parties are also protesting because they fear the misuse of RTI. Nosy busybodies will now ask all sorts of questions. Why did you give ticket to X and not to Y? What is your strategy in the coming elections? This fear is unfounded, because RTI applies to recorded material, not just verbal discussions. Thus an RTI applicant can ask for paper records, files, notings and so on. An applicant cannot ask for recounting what was discussed, but not recorded.
Moreover, section 8 of the RTI law has provisions for denial of information. If RTI queries harm the strategic interests of organizations, or if provision of information will lead to undue costs, then it can be denied. The information officer, as well as the appellate authority who decide on the merits of RTI queries will be office-bearers of the parties themselves. Hence, the fear of misuse of RTI is overblown.
Political parties, unlike any other public or private institutions, are integral to the functioning of our democracy. They enjoy unique privileges. Strangely, the phrase political party does not find any mention in India’s Constitution. Despite their obvious crucial role in the past almost seven decades, lawmakers have not framed any regulation or law governing the functioning of political parties. Many government-appointed committees have pointed to this need. The Law Commission of India’s report of 1999 also had detailed observations on the need for regulatory oversight on the functioning of parties. The Indrajit Gupta committee on state funding of elections (1998) had also indirectly made reference to the regulation of parties. Incidentally, Prime Minister Manmohan Singh was a member of the Gupta committee. More recently, justice J.S. Verma committee also had a chapter on electoral and party reforms. The thrust of the intended regulation is to bring greater transparency in party finances and greater spotlight on their inner functioning as well.
Companies are regulated under company law. Listed companies have to additionally comply with Securities and Exchange Board of India regulations. Cooperatives, trusts, hospitals, schools, colleges, and indeed all NGOs are regulated entities. It is only political parties that are not subject to any regulation or regulator. The prospects of Parliament legislating a comprehensive law to regulate parties are dim. In the absence of any regulation, the CIC verdict subjecting parties to RTI must be welcomed. More citizen scrutiny of parties and their inner working is surely a good thing.
Ajit Ranade is chief economist, AV Birla group. He is also a founder member of the Association for Democratic Reforms.
