SC refuses to grant stay on issuance of electoral bonds, asks Centre to reply in two weeks

Supreme Court on Monday (January 20) refused to grant an immediate stay on issuance of electoral bonds scheme, for the purpose of donations to political parties. It may be recalled that the scheme was notified by the BJP-led government at the Centre on January 2, 2018. The SC has asked the Centre and Election Commission to reply on this matter within two weeks.

On November 21, the Congress had raised the issue of electoral bonds scheme in the Lok Sabha, with party leader Adhir Ranjan Chowdhury announcing that his party has moved an Adjournment Motion over 'lack of transparency in the entire scheme of electoral bonds'. 

"The country is being looted through the scheme. It is a very big scam. The issue is serious and we have given an adjournment notice," Chowdhury had said.

The Finance Bill, 2017 introduced "electoral bonds" as interest-free bearer bonds, which are used to donate money to political parties. Under this scheme, the parties involved will probably be a donor, the political party and the RBI, which acts as an intermediary.

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The Electoral bonds came into existence after amendments through the Finance Act 2017 to the Reserve Bank of India Act 1934, Representation of Peoples Act 1951, Income Tax Act 1961 and Companies Act. The central government notified the electoral bonds scheme on January 2, 2018. It is designed to be a bearer instrument like a Promissory Note, and can be purchased by an Indian citizen or a body incorporated in India.

Electoral bonds may be purchased by a person, who is a citizen of India or incorporated or established in India. A person being an individual can buy electoral bonds, either alone or jointly with other individuals.