SC refuses to stay sale of electoral bonds ahead of Assembly polls

New Delhi [India], March 26 (ANI): Ahead of Assembly elections in West Bengal, Tamil Nadu, Kerala, Assam and Puducherry, the Supreme Court on Friday refused to put a stay on the sale of a fresh set of electoral bonds from April 1.
A Bench, headed by the Chief Justice of India SA Bobde, dismissed the application filed by NGO 'Association of Democratic Reforms'.
The Bench dismissing the application said that since the electoral bonds were allowed to be released in 2018 and 2019 and 2020 without interruption, and with sufficient safeguards there, we do not see any justification to put a stay on the electoral bonds at present.
The Bench had reserved the order in the case on March 24 after hearing arguments from all the parties in the case.
During the hearing, the Attorney General of India, KK Venugopal, had assured the Court that funds received through electoral bonds were white money that could only be issued through cheque and demand draft, and for which Know Your Customer (KYC) norms had to be followed.
Advocate Prashant Bhushan appearing for the NGO had argued that the Governor of the Reserve Bank of India (RBI) has written a letter in which it was stated that the electoral bond scheme was fraught with risk and would impact India's financial system.
Bhushan had added that the RBI raised serious objections and said this would facilitate money laundering through shell companies.
Bhushan further pointed out that the Finance Bill, 2017, which paved the way for the introduction of the electoral bond scheme, was passed as a money bill even though it wasn't.
The top court had asked Attorney General if the government was going to issue electoral bonds, Venugopal replied that the scheme will be open from April 1 to 10 after permission was granted by the Election Commission.
After hearing arguments in the case, the Bench had said it will pass the order later.
The plea of NGO has said the sale of fresh electoral bonds should be stopped till the top court decided the three pending petitions challenging Electoral Bond Scheme 2018 which granted anonymity to donors to political parties.
"There is a serious apprehension that any further sale of Electoral Bonds before the upcoming state elections in West Bengal, Tamil Nadu, Kerala, and Assam, would further increase illegal and illicit funding of political parties through shell companies. Thus, the petitioner seeks a direction that no further opening of a window for the sale of Electoral Bonds is allowed during the pendency of the instant writ petition," the petition stated.
The fresh application is filed in an already pending petition filed by the NGO in 2017, challenging the provisions of Finance Act 2017 which paved the way for anonymous electoral bonds.
The petitioner NGO in its application stated that previously, on two occasions, the government opened a special sale window of electoral bonds right before the State assembly elections, and so far more than Rs 6500 crores worth of Electoral Bonds have been sold with the majority of donations going to the ruling party.
An electoral bond is an instrument in the nature of a promissory note or bearer bond which can be purchased by any individual, company, firm, or association of persons provided the person or body is a citizen of India or incorporated or established in India. The bonds are issued specifically for the purpose of contributing of funds to political parties.
The electoral bond scheme was notified by the Central government on January 2, 2018. (ANI)