InvestorQ : Why the Election Commission has flagged red to new Electoral Bond?
Rashi Mehra made post

Why the Election Commission has flagged red to new Electoral Bond?

Answer
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Niharika Kamble answered.
1 year ago


Electoral Bond is a channel through which an individual and corporate entity can donate fund to political parties of their own choice. The government aims that donation through Electoral Bond will bring transparency and accountability in the donation process. However, the Election Commission has raised its concern that the changes in other laws relating to political funding can cause serious repercussions on the transparency aspect. In its letter Election Commission said that "in a situation where contributions received through electoral bonds are not reported, on perusal of the contribution reports of the political parties, it cannot be ascertained whether the political party has taken any donation in violation of provisions under Section 29B of the Representation of the People Act 1971, which prohibits political parties from taking donations from government companies and foreign sources".Due to changes in the Foreign Contribution (Regulation) Act (FCRA) done through the Finance Act, 2016; there are chances that foreign companies having a majority stake in Indian companies might affect the political parties decision-making. Earlier, no donation could have been done from all foreign sources as defined under the Foreign Contribution (Regulation) Act.


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1 year ago


Today on Tuesday, April 2, 2019, the Supreme Court will hear the petitions that challenged the issuance of electoral bonds by the government. A bench of Chief Justice Ranjan Gogoi and Justices Deepak Gupta and Sanjiv Khanna will be hearing the plea filed for a stay on the electoral bond scheme. Association for Democratic Reforms (ADR) has filed an application as it has a view that many Acts have to be amended which has "opened the floodgates to unlimited corporate donations to political parties and anonymous financing by Indian as well as foreign companies which can have serious repercussions on the Indian democracy". Let's wait for today’s supreme court hearing.