Citizens' Issues
Public Interest Exclusive
Politicians have ingenious ways of using black money for elections: CEC

From fake marriage parties to carrying money in ambulances, politicians are always one step ahead of election officials

“Despite taking preventive measures, black money and unregulated money flow continues to be a biggest hurdle in the way of free and fair elections in India,” said Dr SY Quraishi, India’s Chief Election Commissioner (CEC). He was speaking at a seminar titled “Democracy at Crossroads—Need for Electoral Reforms”, organised by Moneylife Foundation and V Citizens Action Network (VCAN).

Dr Quraishi said, “It is common knowledge that black money is used in elections. In private conversations, after elections when we (Election Commission) cannot do any more harm, politicians tell us what they really spent. We do everything we can do to catch them. We keep track on the money flow and had seized crores of rupees during elections in the past. It does act as a deterrent. But they are always ahead of us and find some new modus operandi to circulate money.”

He gave interesting anecdotes about many ways candidates bribe voters, which in reality is an electoral crime. For instance, in one case, a marriage party was arranged by a candidate during election time. “Ironically, when one of our officers casually walked in that wedding there was neither bride nor bridegroom. On the contrary, a crowd of more than 1,000 people were enjoying the meal and drinks,” explained Dr Quraishi.

Another new technique of supplying money to the voters is by using ambulance and funeral vans. Dr Quraishi said, “Earlier money was easily transferred to the voters using cars. It was hidden in all possible parts of the car. But after our raids, they started using ambulances and funeral vehicles. We had received many complaints regarding the same, but checking these vehicles is a task. We cannot stop an ambulance on mere suspicion and run the risk of a genuine patient being affected. So our solution is to follow the ambulance and then check it the moment it reaches the hospital. This amounts to spending more time as well as money.”

According to the EC, the issue of black money used in election campaigning led to a debate if there is a need to increase the limit on the campaigning expenditure of each candidate. “People told us that the ceiling actually forces candidates to cheat. So we requested the law ministry to increase it. Accordingly, we increased it Rs16 lakh from the Rs10 lakh cap followed till last year in case of Vidhan Sabha elections, and to Rs40 lakh from 25 lakh in case of Lok Sabha elections. We considered 16 years of inflation,” said Dr Quraishi.

However, he added, “When we analysed the returns filed by these candidates, after elections we found that the average spending was Rs8 lakh. Now why would it be so low despite having Rs16 lakh as legal limit? …Because it is black money that has been used. White money is anyways not used. This is our concern.”

Dr Quraishi told that the efforts taken up EC to keep track on the money flow has yielded some results. “MPs (Members of Parliament) and MLAs (Members of Legislative Assemblies) tell us that this has encouraged them to manage with less money. Even our analysis shows that crime and money in election is a competitive phenomena. If one party puts a candidate with criminal background, another party will put candidate having more criminal cases. While we strive to curb the money power menace, somebody has to take a lead to break this competitive attitude.”

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COMMENTS

dayananda kamath k

5 years ago

one of the politician who became a finace minister fo state for banking was caught with bribe money red handed but he escaped saying that the money was paid as investment in national savings certificate and handed over nsc certificate to the party.as reported during those times in news papers.

Aban

5 years ago

Bureaucrats are no better either. What is this hushed discussion about the criminal-bureaucrat-politician nexus? What happens in the posh clubs and top hotels in the evenings when bureaucrats of all levels meet to exchange "suitcases"?

REPLY

Ratanlal Purohit

In Reply to Aban 5 years ago

I am amused. You should see yes minister or yes prime minister bbc serial.
But we are innovators of highest degree. We have boot legger tricks of the trade. Havala rukkas. Angadias. Greeting cards of intrinsic values by couriers and the list is endless. They are always ahead.
I know a very interesting story.
Watchman asked a retiring sweeper as to what was he carrying in the wheel burrow. The wheel burrow came the reply.
Some time we fail to see the obvious. .
Suppose your symbol is cycle your ingenuity is enough. And does Qureshi say about doles etc
Karna hai to bahut kuchh. Nahi to sirf Baaten Mulakaten

Bidup

5 years ago

While it is not denied that what the CEC says is not incorrect, the bureaucrats only are the people who show the path to the politicians in this regard. In fact, a whole department of income tax with a huge number of people are at their service to launder the unaccounted incomes of the politicians and, in the process, 99% bureaucrats do the same. One should not forget that the income tax department is a subordinate office under the department of Revenue in the union Finance Ministry and the Revenue Secretary is invariably an IAS, also invariably junior (in terms of the entry into civil services) to the Chairman and Members of CBDT and even most of the chief commissioners of income tax. This gives the bureaucrat to boss over the IT deptt and the entire chain in the IAS enjoy the privilege as the closest ally of the politicians. It is unfair to blacken the black faces of the politicians and blame them for a corrupt system prevailing in the country and also controlling the entire machinery of elections. The bureaucrats must first look into their hearts and accept the fact that, it is their flexible backbone and the sky high greed (cf. the case of the IAS couple of the MP cadre) that gives total freedom to the breed of humans called politicians. If the govt. or the CEC can show the courage of investigating into the background of all civil servants (IAS in particular) before they jumped into the world of politics, the truth will come out. A corrupt IAS officer was shown the utmost consideration of submitting his VRS papers in view of the huge documentary and clinching evidence of corruption during the very first day in the Service. That corrupt man became a most powerful man in a short lived government. Ask any honest income tax man (very few are still there) and they will tell you the empires built by the top most civilians, the bureaucrats who run this country through the politicians. Petty clerks in the central and state governments or municipalities or giovt. teachers become billionaires in politics, while sharing their booty initially with their superiors or higher ranks of police ans IAS officers. Later, of course, they are saluted and deferred to by the former! Will any NGO engaged in fight against corruption make this study?

P M Ravindran

5 years ago

Isn't it really a pity that we have such honest but helpless officers at the helm of affairs?

And then what is the EC doing about Sec 49(0) (right to reject)?

And about manipulation of electoral rolls?

Yes, 10 days after I got my VIC when I went to the polling booth my name was in the list of deleted names! Considering the trials and tribulations I had undergone to 1st get my name in the electoral rolls and then the VIC, I should not have been blamed even if I had murdered the officials had they come in view at that time!

And mine was not an isolated case. There were plenty and some to them took the matter to the high court and the crime got worse there. If the initial crime could be compared to causing death not amounting to murder, this was absolute murder! The court ruled against the petitioners saying that even if they had voted it would not have made any difference to the election results!

Nagesh Kini FCA

5 years ago

As one present at the CEC's talk, I can say it was quite enlightening. His tongue in cheek real life instances of mischief like wedding without the bride and bridegroom should have booked the inviting in-laws booking the hall/pandal, and also the blaring ambulance without the patient - confiscate the cash and put behind the bars the person who booked it.
It is only instant punitive action that can inspire confidence in the public and put the fear of the devil in the law breakers. Long drawn FIR,. arrests let off on instant bail are no deterrents. Putting the culprits behind the bars and slapping heavy penalties is the best and effective instant remedy.

REPLY

P M Ravindran

In Reply to Nagesh Kini FCA 5 years ago

Rightly said! But will the EC and their officials do it? No way! Why? Because they are one who have their cake and eat it too! Forever pulling wool over the eyes of the gullible and innocents!

Ratanlal Purohit

5 years ago

COMPETITIVE has a new definition to English Dictionary. OUTDOING. ALL are outdoing each other. Who can complain? Will they?
Ofcourse not. They become lawmakers. Slowly all acts will be enacted by SC? Then you call it Judicial Activism.
PIL. TIME HAS COME TO REWRITE OUR CONSTITUTION.
We should consider right too recall. 50+% vote criteria? Debar the charge sheeted. Minimum education or other experience criteria. And how to curn dynasty. Very Nasty route. Put a thought.

Public Interest Exclusive
Can accounting norms check black money in polls?

Chief Election Commissioner Dr SY Quraishi stresses payments by cheques and independent audit as the way out. He was speaking at Moneylife Foundation’s event, “Democracy at Crossroads—Need for Electoral Reforms”

One of the biggest problems in the conduct of free and fair elections is black money. Chief Election Commissioner (CEC) Dr SY Quraishi, speaking at seminar organised by Moneylife Foundation and V Citizens Action Network (VCAN), brought up the issue of black money flowing into elections and that checking the use of this illicit money is one of the top reform proposals of the Election Commission (EC). “No candidate is spending white money, but black money. I don’t know how state sponsorship of elections will solve the problem. The moment a minister comes into power; his target is to recover the money he spent in the election. He convinces the bureaucracy to help him, and the people have to pay for them”, he said.

According to an estimate, in the recent elections the Election Commission confiscated over Rs45 crore of unaccounted cash. The answer, says Dr Quraishi is, “transparency in financial transactions and independent auditing of accounts of candidates. For this we engaged the Chartered Accountants Association to come up with accounting standards.” The accounts of political parties were often audited by their own accountants. It was not independent. We have now specified independent audits.”

According to a proposal by the Election Commission (EC) dated 15 July 1998, “The political parties should be legally required to get their accounts audited annually. The audited accounts should be put in public domain. There should be transparency in the fund raising and expenditure of political parties.” The EC considers that the political parties have a responsibility to maintain proper accounts of their income and expenditure and get them audited by agencies specified by the Commission annually. While making this proposal in 1998, the Commission had mentioned that there was strong need for transparency in the matter of collection of funds by the political parties and also about the manner in which those funds are expended by them.

In an amendment, vide the Election and Other Related Laws (Amendment) Act, 2003, a provision has been made regarding preparation of a report of contributions received by political parties in excess of Rs20,000. However this is not sufficient enough to ensure transparency and accountability. Sub-section (1) of section 77 of the Representation of the People Act, 1951 (43 of 1951) says that “it is an obligation on every candidate at an election to the House of the People or a State Legislative Assembly to keep, either by himself or by his election agent, a separate and correct account of all expenditure in connection with the election incurred or authorised by him or by his election agent between the date on which he has been nominated and the date of declaration of the result thereof, both dates inclusive. Failure to keep such an account is a criminal offence punishable under section 171-I of IPC (Indian Penal Code). Every candidate, or his election agent, is expected to keep a separate and correct account of all expenditure in connection with an election to the House of the People, or to the Legislative Assembly of a State, incurred or authorised by him, or by his election agent, between the date on which he has been nominated and the date of declaration of the result of the election, both days inclusive”. However, there is no current provision where the account needs to be audited and many find ways to by pass these accounting requirements.

Therefore, the EC has proposed that the political parties must be required to publish their accounts (at least abridged version) annually for information and scrutiny of the general public and all concerned, for which purpose the maintenance of such accounts and their auditing to ensure their accuracy is a pre-requisite.  The EC reiterates these proposals with the modification that the auditing may be done by any firm of auditors approved by the Comptroller and Auditor General (CAG). The audited accounts should be available for information of the public. For the same, Institute of Chartered Accountants of India (ICAI) along with the Election Commission has come up with auditing standards under which all expenses incurred should be by way of cheques, there would be independent audits ensuring complete disclosure.

The guidelines, prepared by ICAI, will soon be notified by the Election Commission to the concerned parties. The Commission approved the norms that ICAI has framed which will act as guidance for accounting and auditing of the financial records of political parties. The new norms will enable political parties to conduct their finances in a corporate-like manner by getting their accounts audited and publishing their audited finance sheets annually. The ICAI recommended norms will ensure that “all political parties registered with the Election Commission of India may be mandated to apply accrual basis of accounting (reporting transactions on a real-time basis).”

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COMMENTS

A B

5 years ago

Many practising CAs join politics and prosper. Will those political CAs be ready to allow such norms being laid down?

Nagesh Kini FCA

5 years ago

I eagerly look forward to the CEC notification on the ICAI Accounting Standards for Election Expenses.
It ought to be put into operation at the next earliest Election.
The SEC ought to put in place a panel of really dedicated CAs who will have the capacity to deal with this issue without fear and favour
It is not a simple audit attestation job.

REPLY

C Jyoti

In Reply to Nagesh Kini FCA 5 years ago

Mr. Kini has suggestively remained silent on the points raised by Aban.

nagesh kini

In Reply to C Jyoti 5 years ago

Jyoti - there is nothing like 'suggestively silent' as alleged by you. I wish I could find out the quantum of money spent on elections by members on getting 'plum audits' !
This responds to Aban too.

Aban

In Reply to Nagesh Kini FCA 5 years ago

Before that is done, Mr. Kini may reveal the amount of money spent in the annual elections to the ICAI and central and state councils. Also, let him clarify as to how the ex-presidents of the Instt get plum audits once they demit office.

Java

5 years ago

The elected MPs & MLAs want to recover their 'investment' after elections, which is why we see the frenzy for ministerial berths and 'reservation' of lucrative ministries for coalition partners.
Could one way out be to go for a Presidential/Governor system, which would limit the all-pervasive greed and corruption we see today? The parliament and legislatures would have less of an attraction for MPs & MLAs, as these would no longer be the path to lucrative Ministerships and executive power. Who knows, there could even be an automatic filtering out of the criminals, who might presumably lose interest in politics with only a legislative role.

India world's 2nd most economically confident country: Ipsos

‘India's economic confidence jumped by 9 points to 74% in the month of February compared to the previous month, becoming the second most economically confident country after Saudi Arabia which tops the chart with 90%:’  research firm Ipsos

Indians have emerged as the second most confident people about their economy across the world on easing inflationary pressure and increased foreign investments, says a report.

According to global research firm Ipsos, India's economic confidence jumped by 9 points to 74% in the month of February compared to the previous month, becoming the second most economically confident country after Saudi Arabia which tops the chart with 90%.

Sweden is the third most economically confident country, where 73% are optimistic about their economy, followed by China (72%), Germany (71%), Australia (66%) and Canada (65%).

“The Indian economy has continuously recorded high growth rates and has become the second most preferred destination for foreign investments and business. India's economic growth is expected to remain robust in 2012 and 2013, despite likely headwind of double-dip recessions in Europe and the US,” Ipsos India CEO Mick Gordon said.

More than half of Indian citizens (51%) believe their local economy which impacts their personal finance is good and 56% people expect that the economy in their local area will be stronger in next six months, Ipsos said.

Mick further noted that inflationary pressure eased as the wholesale price index fell, making daily consumption items relatively affordable and giving hopes that Reserve Bank of India will ease its monetary policy stance by reducing the policy rates in the coming months which will further fuel economic growth of the country.

The report, which examined citizens' assessment of the current state of their country's economy said the overall global average economic confidence remained unchanged at 38% last month.

On the other hand only a handful of those in Hungary (3%) rate their national economies as 'good', followed by Spain (4%), Italy (6%), France (7%), Japan (9%) and Great Britain (10%).

Countries with the greatest improvements include India, China, Mexico, Saudi Arabia and Turkey, while, countries with the greatest declines are Argentina, Poland, Belgium, Indonesia and Australia.

The survey was conducted in February this year among 19,216 people in 24 countries like Argentina, Australia, Belgium, Brazil, Canada, China, France, Germany, Great Britain, Hungary, India, Indonesia, Italy, Japan, Mexico, Poland, Russia, Saudi Arabia, South Africa, South Korea, Spain, Sweden, Turkey and the USA.

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