Companies And Electoral Bonds: How Supreme Court Verdict Undoes Big Change
NDTV
Solicitor General of India Tushar Mehta had argued that anonymity ensures that the donor does not face retribution or victimisation
Striking down the electoral bonds scheme, the Supreme Court today also flagged "unlimited political funding" by corporates and said it violated the fundamental right to free and fair elections. The historic verdict effectively put the clock back on crucial amendments made to company laws when the Narendra Modi government brought this scheme in 2018.
What Was The Law? What Changed?
The Section 182 of Companies Act, 2013 governs an Indian company's right to contribute to a political party. Prior to the amendments, this was governed by a set of conditions - the donation should be authorised by the Board; (ii) the donation cannot be made in cash, (iii) the donation must be disclosed in the Company's profit and loss account (iv) the company cannot donate more than 7.5 per cent of its average profits for three years and (v) the company must disclose the name of the party it had donated to.
