Unbonded: On the striking down of the Electoral Bond Scheme by the Supreme Court

Syllabus: GS-II

Subject: Polity

Topic: Elections and RPA

Issue: Electoral Bonds

Anonymous donations of high value undermine electoral democracy and governance.

They facilitate a quid pro quo culture involving donors and beneficiaries.

On the verdict:

  • the entire scheme violates the Constitution, especially the voters’ right to information.
  • Arbitrary Act: the amendment to the Companies Act that removed the cap of 7.5% of a company’s profit that can be donated to political parties (without any requirement to disclose details of the recipient parties in its profit and loss accounts).
  • mandated disclosure of donation details since 2019.
  • the primary justification for the scheme failed the test of proportionality.
  • Instances where the Supreme Court held up Voters Rights:
    1. ‘None of the Above’ option on the ballot,
    2. the removal of the protection given to legislators from immediate disqualification on conviction for a criminal offence,
    3. the mandatory disclosure of the assets and criminal antecedents of candidates in their election affidavits
    4. expedited trials for MPs and MLAs involved in criminal offences.

+ 1 Advantage for Mains:

Test of proportionality: used to decide cases where two or more legitimate rights clash.

  • The courts follow a four-pronged approach wherein the legitimacy, suitability, and necessity of a decision or law is examined.
  • In addition to a balancing test to check whether the decision or law encroaches on rights to an excessive or arbitrary degree.
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