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Electoral Bonds: SBI seeks extension of deadline from Supreme Court

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The State Bank of India (SBI) has appealed to the Supreme Court seeking an extension of more than 3 months time to submit information regarding electoral bonds to the Election Commission of India (ECI). The bank has filed an application seeking time till June 30, 2024 for submitting the information about the now-scrapped bonds as per reports.
This comes nearly 3 weeks after the Apex court instructed SBI to stop issuing electoral bonds on 15th February and directed the bank to submit details of bonds purchased from 12th April, 2019, till the same date to the Election Commission of India. The State Bank of India was given time till 6th March, 2024 for submitting the information while the latter was ordered to publish the information shared by SBI on its website by 13th March.

Reason cited by the State Bank of India (SBI)

In the extension application, SBI has stated that 22,217 electoral bonds were issued for making donations to various parties between April 12, 2019 and February 15, 2024. The redeemed bonds were deposited to the Mumbai Main Branch by the Authorised Branches at the end of each phase in sealed envelopes. The SBI stated that since two different information silos existed, it has to decode, compile and compare forty-four thousand four hundred thirty four (44,434) information sets, according to a report by LiveLaw.

What are Electoral Bonds

The Electoral Bonds scheme was started by the NDA Government in 2018. Under this scheme, anonymous funding could be made to political parties. In this scheme, the identity of the donor was kept confidential both by the bank as well as by the political party which was receiving the donation. These bonds were issued by the State Bank of India (SBI) and sold in multiples of Rs 1,000, 10,000, 1 lakh,10 lakh, and 1 crore. The contributor could buy a bond from SBI and the bank would release it to the political party.
After the money was transferred, the recipient political party would get 15 days time period to encash it.  All donations made under this scheme were anonymous and exempt of taxes. Electoral bonds, with a validity period of 15 days and yet to be encashed, would be returned by political parties or purchasers to the bank, which must refund the amount to the purchasers’ accounts.
Under this scheme, political parties which are registered under Section 29A of the Representation of the People Act, 1951 and which have received more than one per cent votes in the last Lok Sabha or state legislative assembly elections were considered eligible to receive electoral bonds.

Why Electoral Bonds have been scrapped

A five-judge Constitution bench headed by CJI D Y Chandrachud declared Electoral Bonds ‘unconstitutional’ on 15th February this year. The Court said the scheme violates the constitutional Right to Freedom of Speech and Expression as well as the Right to Information. The scheme violates the voters’ Right to Information about political funding under Article 19(1)(a) of the Constitution.
The scheme allowed inflow of huge contributions by business conglomerates, top corporate companies and multinational corporations with major business stakes in the country to political parties. The scheme and the amendments authorised “unrestrained influence of corporates in the electoral process” said the court. The Apex Court said anonymity about the source of political funding through electoral bonds could promote corruption and a culture of quid pro quo with the ruling party to introduce a policy change or for getting a licence.