SG Mehta: Your lordships haven't seen the scheme. The minister is envisaging that my balance sheet would reflect that I'm buying the bond. The scheme says I can buy only when I'm KYC compliant and therefore it'd be known that this gentleman bought electoral bond.
CJI: The balance sheet doesn't reflect which bond he has bought. The balance sheet only reflects the total amount of contributions.
SG: It need not.
CJI: Suppose an electoral bond is purchased, the source of the money is not known. The donor is not known. Where it is spent is not known. All three are not known.
SG Mehta: Out of 100, 5 people may misuse the scheme. That may not be the ground on which your lords may judge the validity. But the rest 95...
CJI: We're not on misuse. We're on what the scheme is capable of...
SG Mehta: The 15 day limit is to reduce the issue of qui pro quo arrangements. I'll explain when I'm explaining the scheme.
CJI: The donor doesn't necessarily buy this bond. The person who buys the bond may not be the donor. Second, the person who buys - their balance sheets will reflect the amount of bonds. Balance sheets of purchaser will reflect, not the donor.
CJI: Then the Finance Minister in his speech says- when the cash is given, the source of money, the donor, and where it is spent is not known. Therefore, atleast now it'll be known. How will this be known?
SG Mehta: "Donors have also expressed reluctance in donating by cheque or other transparent methods as it would disclose their identity and entail adverse consequences." This is what is in the mind of the law maker.
SG Mehta: Noone wanted to go through the electoral trust scheme also because it wasn't anonymised. So this scheme was made
SG Mehta: There were attempts made. Having found that this was possibly the only way to not incentivise this decision was taken
SG Mehta: Please see this speech delivered by one Mr Panika.
SG Mehta: This is the problem we're grappling and we're looking for some solution.
SG: Then in 1985 Corporate funding was re-introduced by Govt by making amendments in S 293A of Companies Act, 1956. All companies, except Govt companies, were allowed to contribute to parties subject to approval by board of directors, disclosure in the profit & loss statement.
SG Mehta: These donations were restricted to five per cent of the company’s average net profits of previous three years.
SG Mehta: In 1969, following the recommendations of Santhanam Committee, the Government introduced an amendment which prohibited any contribution by a company ‘to any political party’, or ‘for any political purpose to any individual or body’.
CJI: For us it is not whether the ruling political party in power presently will be the beneficiary or not. We are testing a question of constitutionality.
SG: Please see the earlier efforts made... everyone has tried their best. Sometimes the problem is this- in political parties also there are divergence of views.