Withhold Enforcement Of Electoral Bonds Verdict By Seeking Presidential Reference : SCBA President Adish Aggarwala Writes To President

“The Supreme Court should not allow itself to deliver judgments that would create constitutional stalemate, undermine the majesty of the Parliament of India, the collective wisdom of the people's representatives gathered in the Parliament and create a question mark over the very democratic functioning of political parties themselves.”

Aggarwala has requested a presidential reference on the issue, advocating for a rehearing of the entire matter in the interest of 'complete justice' for “the Parliament of India, political parties, corporates and the general public.”

On February 15, a Supreme Court constitution bench declared the government's electoral bonds scheme unconstitutional, holding that the anonymous character of electoral bonds violated the right to information protected under Article 19(1)(a) of the Constitution. Alongside this, the court directed the issuing bank, i.e., the State Bank of India (SBI) to disclose details of contributions received by political parties through electoral bonds, with a deadline set for March 6, 2024. However, days before the deadline, the SBI sought an extension until June 30, citing the complexity of the data compilation process.

This request was categorically denied yesterday in a five-judge bench hearing. Holding that all the requisite information was sufficiently available with the SBI allowing it to comply with the direction for disclosure, the apex court instructed the bank to reveal the necessary details by the close of business hours today, enabling the Election Commission of India (ECI) to make the information public by March 15.

Aggarwala, in his letter, has however argued that the electoral bonds scheme, while declared unconstitutional by the Court, was legal and valid when the contributions were made. He contends that the donors, comprising corporate entities, followed a lawful mechanism provided by the government and Parliament of India.

“The 22,217 Electoral Bonds that had been received by different political parties from different corporate entities by way of corporate contributions were perfectly legal and constitutional. How can a corporate entity be punished for having played by Rule valid and legal on the day the contributions were made? Even if the Supreme Court prohibited the electoral bonds scheme, the prohibition shall come into effect only prospectively, and not retrospectively. When there was no legal or constitutional bar, and when there was express provision and amended laws that enable corporate entities to make contributions, how could they now be faulted and punished.”

The letter further points out the potential consequences of revealing the identities of corporate donors and their contributions to political parties. Aggarwala warns of the risk of victimisation and harassment that these corporate entities may face if their details are made public –

“The most dangerous part of this judgment is its direction to the Election Commission of India to correlate the donations and make public which political party received how much from which corporate entity. It has the potential to sound a death knell to both parliamentary democracy and corporate freedom in our nation… Infringing their right against disclosure of either their name or the quantum of their donation or to the parties they had chosen differential contributions will amount to a betrayal of a constitutional trust and sovereign guarantee. Revealing the names of corporates that had contributed to different political parties would render the corporates vulnerable to victimisation.”

He argues that such disclosure could have a 'chilling effect' on corporate donations, dissuading foreign entities from participating in India's democratic process.

“Disclosing such sensitive information, that too retrospectively, will result in a chilling effect in corporate donations and participation in the democratic process. Besides drying up further donations, such an act would discourage and dissuade foreign corporate entities from setting shops in India or participating in the democratic process but contributing to winning horses. If we enforce this judgment retrospectively, releasing all sensitive information, it will shatter the reputation the nation enjoys in the international arena.”

On these grounds, the SCBA president has cited Article 143 of the Constitution, which grants advisory jurisdiction to the Supreme Court and allows the President of India to seek the court's opinion on matters of public importance. Aggarwala's letter urges President Murmu to withhold the enforcement of the Supreme Court's verdict and seek a presidential reference on the electoral bonds case, stressing the need for a thorough rehearing of the matter to ensure complete justice to all stakeholders involved.

"I, therefore, request your goodself to withhold the enforcement of the Hon'ble Supreme Court judgment in the Electoral Bonds case by seeking a Presidential Reference on the matter. Till the Reference is heard and answered, the Hon'ble Supreme Court shall not give effect to its verdict of March 11, 2024," he stated.

It is clarified that this letter has been written on behalf of the All India Bar Association (AIBA), and not the Supreme Court Bar Association.

UPDATE On March 13 - SCBA Executive Committee Condemns President Adish Aggarwala's Letter Asking To Withhold Enforcement Of Electoral Bonds Verdict

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