On Friday, Hon’ble Supreme Court refused to stay the release of a fresh set of electoral bonds from 1 st April for assembly polls in Puducherry, Tamil Nadu, West Bengal and Tamil Nadu.
In the instant case, the NGO Association for Democratic Reforms had sought a stay of the bonds; however, the Court dismissed the application.
In its order, the Bench observed since the bonds were allowed to be released in 2018 and 2019 without any interruption. With sufficient safeguards, there was no justification to stay electoral bonds at present.
Before the Court Election Commission of India submitted that they were not opposed to electoral bonds but wanted more transparency. ECI stated that electoral bonds were one step ahead of unaccounted cash systems.
The Bench observed that it was not correct to say RBI was ultimately against electoral bonds, as it objected that bonds were issued in script form rather than in Demat form. The Bench further observed that even though the scream provided anytime, all transactions were KYC compliant.
As per the Court, anyone can access the Financial Statements of companies as the Registrar keeps a record accessible to everyone.
Addressing the petitioner’s concern regarding the use of black money to repurchase bonds, the Court observed that bonds were not tradeable.
Counsel Prashant Bhushan argued that electoral bonds could be used to launder black money by shell companies, and there was no transparency. Bhushan also pointed out that ECI and RBI have expressed significant concern regarding the same.
The Attorney General retorted that bonds ensure that political funding is routed through banks, eliminating black money.
During the hearing, the Bench expressed concerns that there can be possible misuse of money procured by political parties who use electoral bonds and asked the Central Government if it had control over the said money.
The Bench agreed with Bhushan’s contention and stated that the law should be struck down.