Plea before Supreme Court says Electoral Bonds a scam, needs SIT probe

Before the Supreme Court of India, a petition has been lodged urging for a Special Investigation Team (SIT) inquiry into the electoral bonds system, which was recently invalidated by the apex court in the case of Common Cause and Anr. v. Union of India.

This joint petition is submitted by Common Cause and the Centre for Public Interest Litigation, both registered societies. It contends that an SIT investigation is imperative to uncover purported conspiracies and malpractices facilitated through the electoral bonds program, which permitted undisclosed contributions to political entities.

The petitioners have raised several concerns regarding the electoral bonds scheme:

1. The data on electoral bonds suggests that many of these bonds were provided by corporations to political parties in apparent exchange for various benefits, including lucrative contracts, licenses, leases, clearances, and approvals from government-controlled entities. These benefits, worth thousands or even lakhs of crores, were allegedly granted by government bodies influenced by the political parties receiving the bonds. Additionally, donors purportedly sought protection from legal proceedings initiated by enforcement agencies like the Enforcement Directorate (ED), the Central Bureau of Investigation (CBI), or the Income Tax (IT) Department, or sought relaxations from other regulators. Furthermore, there are suspicions of donors influencing policy changes in their favor.
2. Political contributions through electoral bonds seem to have impacted contracts worth lakhs of crores. Alleged regulatory inaction by agencies, possibly influenced by political donations through electoral bonds, may have allowed the sale of substandard or dangerous drugs in the market, endangering millions of lives.
3. Many donations appear to violate Section 182(1) of the Companies Act, which governs contributions by companies to political parties. This provision prohibits government companies and companies less than three years old from making such contributions. However, electoral bonds data reveal that at least twenty companies purchased electoral bonds within three years of their incorporation. Additionally, data indicates that various loss-making and shell companies donated substantial sums to political parties through electoral bonds, particularly to the ruling party. These findings raise concerns about the proliferation of shell companies as channels to launder illicit funds and gain favor with ruling political parties.
4. The petitioners assert that certain key investigative agencies in the country, such as the CBI, ED, and the IT Department, seem to have been complicit in corruption. They highlight instances where firms under investigation by these agencies have made significant donations to the ruling party, potentially aiming to influence ongoing probes. These concerns have led many observers to label the electoral bonds scheme as India’s largest scam to date, and possibly one of the largest globally.Unlike cases such as the 2G scam or the coal scam, where there was no clear money trail, the electoral bonds scheme leaves a trace. Despite this, the Supreme Court had previously ordered court-monitored probes in those cases.Therefore, the petitioners now call upon the Supreme Court to initiate an investigation into the matter by establishing a Special Investigation Team (SIT). They propose that this SIT should consist of sitting or retired officers selected by the Court and be supervised by a retired Supreme Court judge.

   “The investigation in this case would not only need to unravel the entire conspiracy in each instance, which would involve officers of the company, officials of the government and functionaries of political parties but also the officers concerned of agencies like the ED/IT and CBI etc., who appear to have become part of this conspiracy,” the plea states.

   The petition has been filed by advocate Prashant Bhushan and drafted by advocates Neha Rathi and Kajal Giri.