Authored By: Snigdho Dhar
University of Engineering and Management, Kolkata
I. Case Citation and Basic Information
Case Name: Association for Democratic Reforms v. Union of India
Court: Supreme Court of India
Bench: Chief Justice D.Y. Chandrachud, Justice Sanjiv Khanna, Justice B.R.Gavai, Justice J.B.Pardiwala and Justice Manoj Misra
Date of Judgment: 15 February 2024
Citation: 2024 SCC OnLine SC 113
Nature of Case: Writ petitions under Article 32 of the Constitution challenging the validity of the Electoral Bond Scheme, 2018 and related statutory amendments.
II. Free and fair elections are the foundation of a country.
Transparency in funding is essential to ensure that people can make informed choices during elections.
The Electoral Bond Scheme was introduced by the Government of India in 2018 to reform funding.
The scheme allowed individuals and companies to donate to parties through special bonds.
However, the scheme faced criticism.
People argued that it allowed donations and gave too much power to corporations.
Several petitions were filed in the Supreme Court challenging the scheme.
In Association for Democratic Reforms v.
Union of India, the Supreme Court made a landmark judgment.
The Court struck down the Electoral Bond Scheme as unconstitutional.
The Court said that anonymous donations through bonds violated citizens’ right to information.
III. Facts of the Case
The Electoral Bond Scheme was introduced in January 2018.
The scheme allowed people to buy bonds from the State Bank of India.
These bonds could be donated to political parties.
To implement the scheme, several laws were changed.
These changes included exempting parties from disclosing donations received through electoral bonds.
The changes also removed the cap on donations.
Civil society organizations, including the Association for Democratic Reforms (ADR) and Common Cause, challenged these changes in the Supreme Court.
They argued that the scheme undermined transparency and allowed anonymous corporate funding.
IV. Legal Issues
The legal issues before the Court were:
Whether the Electoral Bond Scheme violated citizens’ right to information.
Whether the changes made to laws were constitutionally valid.
Whether unlimited and anonymous corporate donations infringed the principles of fair elections.
V. Arguments Presented
Petitioners Arguments
The petitioners made arguments against the scheme.
They said that voters have a right to know the sources of funding.
They also argued that the scheme allowed donations and gave too much power to corporations.
Respondents Arguments
The Union Government defended the Electoral Bond Scheme.
They argued that the scheme was introduced to reduce money in political funding.
They also said that donor anonymity was essential to protect contributors from victimization.
VI. Courts Reasoning and Analysis
The Supreme Court unanimously struck down the Electoral Bond Scheme.
The Court said that democracy depends on an electorate.
It reiterated that the right to information is a part of freedom of speech and expression.
The Court rejected the government’s argument that donor anonymity outweighed the public’s right to information.
It held that the restrictions imposed by the scheme were not proportionate to the objective of curbing money.
VII. Judgment and Ratio Decidendi
The Supreme Court unanimously held that:
1. The Electoral Bond Scheme, 2018 is unconstitutional.
2. The changes to the Representation of the People Act and the Companies Act are unconstitutional.
3. The scheme violates the right to information.
The Court directed the State Bank of India to stop issuing bonds immediately.
It also directed the SBI to provide details of all electoral bond transactions to the Election Commission of India.
VIII. Analysis
Significance of the Decision
The judgment is a significant constitutional decision.
It reinforces the principle that transparency is essential to democratic governance.
The decision strengthens integrity by ensuring greater openness in political financing.
Implications and Impact
The judgment is likely to influence reforms concerning political finance and electoral transparency.
It may encourage Parliament to devise mechanisms balancing donor privacy with public accountability.
Critical Evaluation
While the judgment has been widely welcomed, some commentators argue that complete disclosure may discourage donors.
The Court did not formulate a framework for future political funding reforms.
IX. Association for Democratic Reforms v.
Union of India is a milestone in India’s electoral jurisprudence.
The Supreme Court reaffirmed that transparency, accountability and informed citizen participation are features of democracy.
The judgment underscores that political parties cannot remain insulated from scrutiny regarding their sources of funding.
X. Reference(S):
1. Association for Democratic Reforms, v.Union of India 2024 SCC OnLine SC 113.
2. The Constitution of India came into effect in 1950.
3. The Representation of the People Act was passed in 1951.
4. The Companies Act was passed in 2013.
5. The Finance Act was passed in 2017.
6. The Electoral Bond Scheme was introduced in 2018.
7. In the case of Union of India versus Association for Democratic Reforms, the Supreme Court of India made a ruling in 2002, which can be found in the volume of the Supreme Court Cases, page 294.
8. In the case of Peoples Union for Civil Liberties, versus Union of India, the Supreme Court of India made a ruling in 2003, which can be found in the volume of the Supreme Court Cases, page 399.
9. M.P.Jain wrote a book titled “Indian Constitutional Law” which was published by LexisNexis.
10. V.N.Shukla wrote a book titled “The Constitution of India” which was published by Eastern Book Company.
