Govt. defends electoral bonds scheme in SC

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  1. A petition has been filed in the Supreme Court asking for it to strike down the Electoral Bond Scheme 2018 and amendments in the Finance Act, 2017.The act says that political parties are not required to maintain any record of the names and addresses of donors of these bonds.
  2. Government has defended the electoral bonds scheme in the apex court as (a)Electoral bonds have been introduced to promote transparency in funding and donation received by political parties (b)The scheme envisages building a transparent system of acquiring bonds with validated KYC and an audit trail.and (c)The electoral bonds will prompt donors to take the banking route to donate,with their identity captured by the issuing authority.This will ensure transparency and accountability and is a big step towards electoral reform.
  3. Electoral bonds are bearer instrument in the nature of a promissory note and an interest-free banking instrument.A citizen of India or a body incorporated in India is eligible to purchase the bond.
  4. Electoral bonds can be purchased for any value in multiples of ₹1,000, ₹10,000, ₹10 lakh, and ₹1 crore from any of the specified branches of the State Bank of India.
  5. Every party that is registered under section 29A of the Representation of the Peoples Act, 1951 (43 of 1951) and has secured at least one per cent of the votes polled in the most recent Lok Sabha or State election will be allotted a verified account by the Election Commission of India. Electoral bond transactions can be made only via this account.The bond have to be encashed within 15 days.
  6. The concerns regarding electoral bond are (a)It keeps the identity of the donor absolutely confidential and (c)banks will not know who is the recipient of the bond .