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Electoral reforms in the hands of politicians is a classic example of a fox guarding the henhouse. While there are many policies that both major parties disagree with each other on, they form a remarkable tag team when it comes to electoral reforms. Unsurprisingly, the Supreme Court, over the last few decades, has readily stepped in to introduce electoral reforms. However, most of these interventions are directed at candidates, and rarely at the parties. The Supreme Court’s recent decision on information disclosure (Lok Prahari v. Union of India) paves a way for future constitutional interventions in India’s party funding regime, including the scheme of electoral bonds.

In 2002, the Supreme Court, in a landmark decision in Association for Democratic Reforms v. Union of India (ADR), mandated the disclosure of information relating to criminal antecedents, educational qualification, and personal assets of a candidate contesting elections. Sixteen years later, the court has extended the disclosure obligation to further include information relating to sources of income of candidates and their “associates”, and government contracts where candidates or their associates have direct or indirect interests.

The principled basis of the court’s decision is that voters’ right to know about their candidate is an extension of their freedom of expression; voters cannot be said to have freely expressed themselves (by voting) without having appropriate information about the candidates. They should have the opportunity of receiving relevant information “to make an appropriate choice of his representative in the Legislature”. What Lok Prahari does is that it extends the ADR decision to include information about the candidate’s “associates”; relevant information for voters is no more limited to the candidate’s personal information. What does this decision tell us about party funding?

If there is one piece of information that a voter is most deprived of in India, it is that about party funding. While the scheme of electoral bonds has received much attention, another significant facilitator of opacity is an obscure, yet significant provision of the Representation of the People Act, 1951: Section 29C(1)(a). The provision exempts political parties from disclosing the source of any contribution below ₹20,000. This gives political parties a convenient loophole to hide their funding sources by breaking contributions into smaller sums, even ₹19,999 each. As a result, a vast majority of donations to political parties come from sources unknown to voters. The new scheme of electoral bonds takes away even the facade of disclosure requirements that used to exist in earlier law.

Is the information about party funding relevant for a voter in choosing a candidate? Upholding the constitutionality of disclosure requirements for funding sources in Buckley v. Valeo, the U.S. Supreme Court held, “The sources of a candidate’s financial support also alert the voter to the interests to which a candidate is most likely to be responsive.” Therefore, it is essential for voters to know the funding sources of their candidates. Parties in India play at least two crucial roles in the election of candidates, namely financial support to candidates, and, more importantly, setting the agenda. Not much needs to be said about direct and indirect ways in which parties financially support their candidates.

However, even if one assumes that parties do not fund their candidates, there is another rationale for disclosure of party-funding sources. Parties occupy a special space in India when it comes to agenda setting. By virtue of a strong anti-defection law in India, all elected legislators are bound by their party agenda. If an elected legislator refuses to toe the party line, she can be disqualified. In Kihoto Hollohan v. Zachillhu And Others, the Supreme Court, upholding the anti-defection amendment, noted: “A person who gets elected as a candidate set up by a political party is so elected on the basis of the programme of that political party.” Parties cannot lay claim to the representation of a candidate, and at the same time argue that information about party funding is not relevant for voters. In short, you cannot have your cake and eat it too.

As a matter of policy, one may argue that strict transparency norms may not always be desirable. However, as a matter of legal principle, the court’s recent judgment in Lok Prahari, read along with our constitutional structure, strikes a blow against the provisions discouraging transparency in party funding. If the court’s jurisprudence is consistently applied, the scheme of electoral bonds could be declared unconstitutional.

Aradhya Sethia is an LLM candidate and resident fellow at Yale Law School

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