Electoral Bonds: Only 23 Political Parties Out of 105 Are Eligible for Redemption
Moneylife Digital Team 20 April 2022
Only 23 political parties have so far opened current accounts with the State Bank of India (SBI) and are, thus, eligible for redemption of electoral bonds (EB), reveals a reply received under the Right to Information (RTI) Act. 
 
Information obtained by Commodore (Cmde) Lokesh Batra (retd) under RTI shows that SBI, the designated bank for EBs, has verified political parties' eligibility for encashment of these bonds on 30 March 2022. 
 
"23 political parties have opened their account for the purpose of encashing electoral bonds till date. (accounts are being opened at the branches after obtaining approval from digital and transaction banking (D&TB) department)," SBI told Cmde Batra.
 
However, citing Sections 8(1)(e) and (j) of the RTI Act, SBI declined to reveal the names of the 23 political parties. 
 
Interestingly, in February 2020, the Election Commission of India (ECI) submitted in the Supreme Court a counter affidavit containing the names of 105 political parties or beneficiaries (see the list at the end of this story).
 
In its affidavit, ECI had stated, "A list showing the status of filing of 'electoral bond; details by 105 political parties in a sealed cover as the direction of the SC." 
 
Interestingly, in December last year, the Union government had told the Lok Sabha that details of EBs encashed by political parties are not collated centrally at SBI.
 
In a written reply, Pankaj Chaudhary, minister of state for finance, told the Lok Sabha, "The purchaser is allowed to buy electoral bonds only on due fulfilment of all the extant instructions regarding know-your-customer (KYC) norms issued by the Reserve Bank of India (RBI) and by making payment from a bank account. All payments for the issuance of the bond are accepted only in Indian rupees, through demand draft or cheque or through electronic clearing system or direct debit to the buyer's account. The details of electoral bonds encashed political party-wise are not collated centrally at the SBI."
 
While the minister supplied information on the amount of EBs purchased by the general public and redeemed by eligible political parties till the XVIII phase, he could not disclose details of EBs encashed by eligible political parties.
 
Commenting on Mr Chaudhary's reply in the Lok Sabha, Cmde Batra says that if the party-wise data on encashment of EBs is not available with SBI, who maintains such data? "How could the government claim that amount encashed or collected only by eligible parties through electoral bonds? What is the government hiding?" (Read: Electoral Bonds: Details of Bonds Encashed by Political Parties Is Not Collated Centrally by SBI, Says Govt)
 
Last year in January, the Supreme Court declined to grant an interim stay on the 2018 electoral bonds scheme. It had also sought replies from the Central government and the Election Commission on a plea filed by Association for Democratic Reforms (ADR), a non-government organisation (NGO). 
 
Earlier this month, a bench headed by chief justice NV Ramana agreed to hear the plea against the laws allowing political parties' funding through the Electoral Bond Scheme. 
 
Advocate Prashant Bhushan, representing the NGO, submitted before the bench that it is a critical issue that requires an urgent hearing. He cited a news report where a Kolkata-based company paid Rs40 crore through electoral bonds to ensure that no excise raids are conducted on it.
 
The chief justice replied that if it were not for COVID,  the Court would have heard the matter.
 
The bench, also comprising justices Krishna Murari and Hima Kohli, assured advocate Bhushan an early listing of the matter. (Read: SC Agrees To Examine Plea against Electoral Bond Scheme Soon
 
In 2017, ADR had filed a plea alleging subversion of democracy through illicit and lack of transparency in the accounts of all political parties. The government notified the Electoral Bond Scheme on 2 January 2018.
 
As reported by Moneylife, from 2018 to 2021, SBI sold 15,420 electoral bonds, of which 12,274 bonds worth Rs7,994.97 crore were encashed. About 146 bonds worth Rs20.28 crore that remain uncashed were transferred to the Prime Minister's National Relief Fund (PMNRF). (Read: Electoral Bonds: Govt Printed Bonds Worth Rs18,531 Crore but Sold only Rs7,994.98 Crore in 18 Phases)
 
Information obtained by Cmde Batra under RTI shows that the Union government procured bonds worth Rs18,531.50 crore during calendar years 2018 and 2019. These bonds were sold in 19 phases through 29 designated branches of SBI. 
 
During the 19th phase, bonds worth Rs1,213.36 crore were sold through select branches of SBI. SBI’s Mumbai branch sold EBs worth Rs489.50 crore, Chennai at Rs227.50 crore and Kolkata at Rs154.48 crore. Hyderabad (Rs126 crore) and New Delhi at Rs117.62 crore are other cities that contributed more than Rs100 crore in the 19th phase of EB sale. 
 
During the 19th phase, the New Delhi branch of SBI witnessed encashment of EBs worth Rs784.85 crore, out of the EBs worth Rs1,212.86 crore encashed at SBI. As per the reply received by Cmde Batra, bonds worth Rs40.01 lakh remained uncashed and would be transferred to the Prime Minister’s National Relief Fund (PMNRF). (Read: Electoral Bonds: Mumbai Contributed Rs490 Crore; Delhi Encashed Rs785 Crore Out of Rs1,213.26 Crore in 19th Phase)
 
On 2 January 2018, the finance ministry notified the EB scheme. As per the scheme, an electoral bond is a bond issued like a promissory note. It may be purchased by a person who is a citizen of India or entities incorporated or established in India. The bonds are issued in multiples of Rs1,000, Rs10,000, Rs1 lakh, Rs10 lakh and Rs1 crore. 
 
Here is the list of 105 political parties as submitted by ECI to the SC…
 

EB Policital Parties ECI Af...

 
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