Swarn Kishore Singh

Transparency should be hallmark of conduct of public institutions in a democracy but selective transparency is even more dangerous than a completely opaque system as the former can be used as a tool to haunt and hunt some specific targets when others enjoy the immunity. India is the world’s biggest democracy and participation of political parties in elections in a multi-party system is an essential ingredient of healthy functioning of a democracy.

For smooth functioning of political parties and contesting of elections, political funding is just necessary. Political funding in independent India has always been a very controversial issue, be it the funding of Nehru led Congress party by corporates like Bajaj, Birla, Thakurdas etc. and consequent inclusion of Land Acquisition laws in 9th schedule and hence keeping them outside the scope of judicial review, rampant funding of Swatantra Party by the corporate and consequent repealing of 293A of Companies Act, 1956 by Indira Gandhi thereby completely banning political funding by corporate and then reintroduction of the corporate funding by Rajiv Gandhi with certain fresh safeguards.

Sometime ago when Finance Minister, Smt. Nirmala Sitharaman said that since she doesn’t have enough money to contest Lok Sabha elections hence she is refraining to jump in electoral fray, it should have had alarmed us about the future of electoral politics without muscle and money.

One thing we as citizens need to understand that not every mode of political funding is bad. In 1962, when Ram Manohar Lohia was contesting Lok Sabha elections from Phulpur constituency against the then Prime Minister, Jawahar Lal Nehru, he devised a simple strategy of election funding; crowd funding. In his popular jeep whenever he reached a village or township to canvass for election, along with seeking support and votes for elections he used to ask for money from the people of that village or town so that he could move ahead with his election campaign. It is no secret that political parties need funds to operate and it is no rocket science to know that functioning of political parties is very essential for proper functioning of democracy. Janeshwar Mishra (popularly known as Chhote Lohia) was contesting elections against VP Singh from Allahabad Lok Sabha constituency in 1977 General elections and in an election rally, Chandershekhar, the then President of Janta Party, appealed for “Ek Note, Ek Vote” from every individual. Consequently at the end of rally, the workers had collected Rs. Two lakhs seventy five thousands via crowd funding, this amount was subsequently given to Janeshwar Mishra for election expenses.

In the electoral bonds matter, Hon’ble Supreme Court has declared the whole scheme of electoral bonds as unconstitutional while setting aside the amendments made in RBI Act, Representation of People Act, Companies Act and Income Tax Act because these all amendments and the parent scheme was synchronized to make the whole process of political funding opaque. The Apex Court while observing that this scheme violated the voters’ right to information about political funding did strike down the whole scheme. Has nullifying the whole scheme ensured transparency in political funding; I am afraid it hasn’t.

I have not even an iota of doubt to when I am saying that this judgment of Hon’ble Apex Court will be counterproductive and will place our political and democratic set up in a very precarious situation. Justice Robert Jackson, a judge of Supreme Court of the United States said, “We are not final because we are infallible, but we are infallible only because we are final”. The word of Supreme Court is final but not immune to some serious flaws; law as a subject remains dynamic and hence prone to changes, what is law of a land today can be an embarrassment tomorrow. It was our Supreme Court only who delivered a treacherous judgment like the one passed in ADM Jabalpur matter which was somehow over-ruled later. We have another example in Dashrath Rupsingh Rathod Vs. State of Maharashtra & Anr. judgment, wherein the Apex Court while deciding the jurisdiction for filing of a complaint u/s 138 NI Act tilted in favor of the accused only. There are too many bending and twisting of laws which a legal system can do but bending the law in favor of the aggressor is the most absurd and tyrannical among the lot; in both the above mentioned cases the Apex Court has been condemned of doing the same. In the electoral bonds matter, the Apex Court had to choose between realism and idealism; sadly in the quest of idealism our highest court went a little far from realism thereby killing the endeavor of the government to cleanse the rotten and opaque system of political funding. Congress and other regional parties are playing chicken for now so that some corporate may throw a bone to them as well; but in the long run this judgment of the Apex Court will prove to be a body blow for political funding of opposition parties in India.

After Indira Gandhi had repealed section 293A of Companies Act, 1956, it became a trend for the corporate to donate money to the political parties in cash that too without making entries in their log books; since then the magnitude of cash funding has increased only. Cash flow ostensibly leads to influx of black money and political funding via cash to a great extent has led to rampant laundering of black money and therefore catalyzing a major shift in denomination of politicians we are having in today’s times. Earlier the politicians who were mostly academicians, lawyers, thinkers, writers are now replaced by contractors, criminals and even businessmen with some very shady businesses.

When the political funding was majorly in cash the influx of black money can’t be ruled out. When a corporate is found funding a party other than the one in power, dire repercussions follow; therefore the donors ostensibly have certain reservations to donate money via cheques or other electronic modes as the disclosure of their identity entails some adverse consequences. This apprehension of the corporate and other donors should have had been considered while formulating a policy for political funding initially, hence the government had introduced a new and modern concept of electoral bonds so that the process of political funding could be less porous and no laundered money could come into play. In a move to encourage usage of this new modus of electoral donation the government had promised the donor some privacy with regard to disclosure of his identity. Of course there were some very absurd provisions carved as part of the scheme which made it opaque and prone to gross misuse but the Apex Court without considering the bigger perspectives of political funding and instead of contributing to refining of the process quashed the whole scheme being unconstitutional thereby obliquely reviving the old style of cash funding. Also the ostentatious amounts published by the election commission about the purchase of electoral bonds by some business houses hide more than they reveal; the big business houses have again found a way out or a proxy.

Corporate funds the political parties and in return the political parties facilitate them when they are framing any policy and this is a dirty little secret every political party has to carry. Also this whole eco-system of interdependence has become very dubious considering the over-interference and over indulgence of corporate in running of state. But if the people start funding the political parties directly, although this may sound strange and absurd for now but just imagine one third population of India donates just Rs. 1000 every five years (i.e. Rs. 200 per year) through UPI to whichever political party they like, what could be the possible outcome. Political funding of around 50 thousand crores; purely transparent, no risk of money laundering, no influence of corporate in policy making thereby making governance more people friendly. When corporate funds political parties, political parties facilitate them and if people fund the political parties directly, the political parties will work for them, simple!

There is no doubt the scheme propounded by the Government wasn’t perfect but with time it could have been made more fair and transparent. But what Supreme Court’s verdict in this matter has done is that it decimated the chances of funding of opposition parties and revived electoral funding through black money and we are back to Indira Gandhi’s era of political funding. Sad!

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