Imagine billions of rupees being put into a black box, where money reaches political parties without any trace. India’s Electoral Bond Scheme had promised the same as a step towards clean funding. But the 2024 decision of the Supreme Court lifted the curtain on it, revealing a corruption trap of more than ₹16,500 crore. The scheme, which was meant to bring transparency, hid large-scale transaction deals between companies and parties. In this post, we will look at the data, scandals and why the institutions failed us. With the help of experts like Jagdeep Chhokar of the Association for Democratic Reforms and RTI activist Amrita Johri, we will see how this became India’s biggest political funding scandal.
Introduction Of Electoral Bonds And Constitutional Challenge
Contradiction: Transparency vs. Anonymity
In 2017, the Minister of Finance promised to bring transparency to electoral funding after 70 years of opaqueness by standing in Parliament. He talked about openness during the budget speech. But just hours later, in a media chat, he reversed his word, describing Bond as anonymous, like Bearer Bond. Jagdeep Chhokar was very shocked by this change. He read about anonymity in the Indian Express the next day and understood that something was wrong. Transparency and confidentiality cannot go together; they are at odds with each other. Chhokar considered it a direct attack on the right of citizens to know who funds their leaders. The scheme allowed anyone – companies or wealthy donors – to secretly buy bonds and give them to parties. No record means no question. This increased the fear of hidden favors, and the elections became a pay-to-play game.
Timeline of Supreme Court’s intervention and decision
Common Cause and ADR filed a public interest litigation in September 2017. He argued that this scheme is unconstitutional for two reasons. First, it was passed as a money bill, which is only for the budget and not for party funding rules. Second, the changes made to four laws – the RBI Act, the Income Tax Act, the Companies Act and the Representation of the People Act – clashed with the core ideas of democracy. Chief Justice Ranjan Gogoi had said in the beginning that this matter raises big issues for the entire election system. He asked for a detailed hearing but there was a delay. Activists like Amrita Johri and others filed five or six petitions for early hearing. The final debate ended in November 2023. The ruling came in February 2024, just before the elections, which ruled the scheme unconstitutional. Some people objected to this, saying that it was targeting the ruling party. But Chhokar explained: The case started in 2017, so the court set the pace, not them.
Transaction Revealed: Data Exposes Shocking Connection
Mapping donations from regulatory actions and contracts
All bond data had to be released by court order. What came out shocked everyone: companies bought bonds worth ₹16,500 crore from 2018 to 2024. More than 94% ₹came in pieces of 1 crore, which points not to small donors but to big corporate players. The analysis showed clear patterns of transactions. Firms under the scrutiny of agencies such as ED or CBI donated large sums of money. Then, the cases disappeared or the investigation stalled. The Wire reported that 40 such companies gave ₹5,180 crore despite being under pressure from Central Watchdogs. This data was clearly a matter of transaction. Donations were not gifts; They were bribes to remain silent or for profit. In return, the parties awarded contracts worth millions. Bond was just a small part – a kickback in a million-crore scam.
Example of Aurobindo Pharma
Take Sharad Chandra Reddy, director of Aurobindo Pharma. ED arrested him on November 10, 2022, in the Delhi liquor scam. Just five days later, his firm bought ₹5 crore bonds for BJP. Months passed. In May 2023, Reddy sought bail on medical grounds. ED did not oppose it. He came out, became a government witness in the same case that later arrested Delhi CM Arvind Kejriwal, and donated another ₹25 crores to BJP. This timeline rings alarm bells. Was donation a shield? It shows how money can influence investigations, and justice is left in the dark.
Future gaming and hotel services – largest donor
Future Gaming topped the list, buying bonds worth about ₹1,337 crore. He gave cash to parties like TMC, DMK, YSRCP and BJP. He was under investigation for money laundering of ED. Meanwhile, he donated ₹100 crore to BJP. In West Bengal, two cases of fraud and conspiracy were pending against him. After giving ₹106 crores to TMC, Kolkata Police closed both the cases with a clean report. Was it just a coincidence? Probably not. This lottery firm used the donation to get the case closed, which proves that the bond made the job easier both in the state and at the Centre.
Corporate Payback: Contracts against funds
Megha Engineering donated ₹500 crore to BJP. Soon after, he got huge contracts worth lakhs and crores in BJP ruled states and the Centre. He also gave money to BRS in Telangana and got deals there too. Scroll’s investigation revealed that Bharti Group gave ₹150 crores to BJP. Soon after, a bill was introduced in Parliament to change his favor in telecom laws. Journalists and citizens searched the data. He also got deals with TMC, INC, Congress and other parties. This gave a clear picture: Donate now, get the policies made later as per your convenience. This corporate-political relationship is very deep, which hurts Fair Play.
Institutional Failure: Capturing And Avoiding Accountability
Role of enforcement agencies and regulators
The institutions built to protect democracy collapsed. Chhaukar called it “institutional occupation”. Agencies like ED, CBI and Election Commission of India (ECI) bowed to power. ECI had earlier warned against this scheme in writing. They feared that fake companies would be filled. But his lawyers in the court changed sides and defended it. This change emerged from the RTI files. RBI stood by its stand and called it wrong. A Finance Secretary’s note revealed the pressure, and the Governor resigned. ED directors continued to get extensions ignoring the court’s limitations. This is a system that is designed for the powerful.
State Bank of India’s opposition to transparency
The SBI, which issued the bonds, was reluctant. He asked for six months to trace the data. But journalist Poonam Aggarwal proved it wrong. They bought the bonds, conducted forensic examinations, and found unique hidden codes appearing in UV Lite – which linked the buyer to the party. After contempt pressure, the court ordered the release of data within two days. Data emerged, showing that firms at a loss were donating many times what they were worth. Amrita Johri’s RTI for SOP of SBI was refused. He used the excuse of “commercial confidence”, while public funds were at stake. This procrastination destroys trust. India’s largest bank works like a private club, which hides secrets.
Unfinished business: Demands of the Supreme Court and SIT
The court struck down the scheme, which was a major victory for the right to know. But Common Cause and the Center for Public Interest Litigation wanted more: a Court-supervised SIT investigation. He advocated an impartial investigation free from government influence. ED and CBI also had their own allegations. The court rejected it, leaving the accountability incomplete. Chhaukar regrets this. The decision missed the chance for a real change in funding rules. Now, proving bribery requires a force that only the state has – and that too is tainted.
Deep Rot: Need To Reform The System To Prevent Misuse Of Political Funding
Beyond Bonds: The Persistence of Cash and Corporate Alliances
The bonds are gone, but the game is not over yet. Cash donations are still hidden before and after the scheme. This is what Megha Engineering’s new scandal shows: they got contracts worth ₹14,000 crore wrongly, even without bonds. After a challenge, the Supreme Court intervened and canceled him. Nevertheless, it remains rot. Pharma companies manufacturing bad medicines donated and kept avoiding regulators. Substandard drugs remained on the shelf, putting lives at risk. This nexus is a threat to health and fairness. Money buys policies, not progress.
Internal democracy in political parties
Parties have to become democratic from within. Chhokar first emphasizes this as an improvement. Most of the parties do not run like open groups, but like jagirs. The 1999 Law Commission report had made it clear: democracy cannot stand on undemocratic pillars. Only a few of the 2,500 registered parties are active, so top-down control ends the election. We cannot claim vibrant democracy when parties secretly elect leaders. The real change starts here. Open elections within parties make accountable parties.
Complete financial transparency and digitalization
Second solution: Complete transparency in party cash. All funds should be digital—no scope for cash. Chhokar even suggests that even small amounts like ₹10 be given to the rickshaw puller through the app. So why not for parties? Digitize everything to track flow. According to a 2013 order, the RTI already applies to the parties. But no one follows it. Implement it, and bribes will be reduced. If these steps are strictly implemented then this filth can be cleaned.
Conclusion: Transparency Achieved, Accountability Awaited
The electoral bond scam exposed the shortcomings of India’s political funding. What started as a tool of transparency became a bulwark of corruption, with ₹16,500 crore being used to repay favours. The Supreme Court’s decision gave us the data and revoked it, thereby upholding our right to know. Nevertheless, institutions such as SBI and agencies shied away from real reforms. Not having a SIT means there will be no deep scrutiny of the transaction. Cash still exists, and the corporate-party relationship remains. We now need internal democracy and digital funding of the parties. Insist on these improvements—write to leaders or join a watchdog group. Your voice may demand clean politics. Share your thoughts in the comments below or email us. Let’s build a better system together.
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