Plea in Supreme Court Seeks Confiscation of Funds from Electoral Bonds

A new plea has been registered in the Supreme Court, pressing for the confiscation of funds amassed by political parties through the electoral bonds scheme. The scheme, introduced in 2018, was declared unconstitutional by the apex court on February 15, 2023, in the landmark case of Association for Democratic Reforms versus Union of India.

The petitioner, Khem Singh Bhati, argues that the funds received by political parties via electoral bonds should not be considered as donations but as “barter money” exchanged with corporate houses for undue advantages. These benefits were allegedly provided at the expense of the public exchequer, raising serious ethical and legal questions.

The plea, drafted by senior advocate Vijay Hansaria and filed by advocate Jayesh K Unnikrishnan, accuses political parties of exploiting their governmental authority to secure significant amounts of money through these bonds. It claims that the financial contributions were made by companies either to evade criminal prosecution or to gain monetary benefits through contracts and other policy manipulations.

Further, the petitioner has requested the court to form a committee led by a former Supreme Court judge to probe into the alleged illegal advantages granted to the donors. Additionally, an alternative plea demands the Income Tax Authorities to reassess the income tax filings of the respondent political parties from the fiscal years 2018-2019 to 2023-2024. The reassessment would involve the disqualification of tax exemptions previously claimed under section 13A of the Income Tax Act, 1961, and the imposition of taxes, interest, and penalties on the amounts procured through electoral bonds.

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This case emerges in the backdrop of the Supreme Court’s February ruling which criticized the electoral bonds scheme for undermining the constitutional rights to freedom of speech and information. The decision also mandated the State Bank of India to halt the issuance of these bonds and reveal the details of all bonds sold from April 2019 till the date of the judgment.

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