The court's decision was based on findings that several sections of the Representation of People Act, 1951, and the Companies Act, as amended by the Finance Act of 2017, were in violation of Article 19(1)(a) and hence unconstitutional. The court emphasized the arbitrary nature of the changes, particularly concerning corporate contributions, and stressed the potential for undue influence and corruption in the electoral process.
Further, the court mandated the disclosure of details regarding political parties receiving contributions through electoral bonds. This responsibility falls on the State Bank of India and the Election Commission, who have been tasked with providing and publishing this crucial information, respectively.
The significant ruling by the Supreme Court has far-reaching implications for political funding in the country.
The Electoral Bond serves as a funding mechanism for political parties in India. It was incorporated into the Finance Bill, 2017 during the Union Budget 2017-18 with the aim of enhancing transparency in political party financing by setting the maximum limit for cash donations at Rs 2,000. Subsequently, a significant volume of electoral bonds, totaling Rs 9,857 crore, were transacted from March 2018 to April 2022. On 7 November 2022, the Electoral Bond scheme was revised, extending the allowed sale days from 70 to 85 in years featuring scheduled assembly elections. This adjustment was implemented shortly before the assembly elections in Gujarat and Himachal Pradesh.
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