sale-of-electoral-bonds-worth-695-crores

Context: In an RTI reply the State Bank of India (SBI) sold electoral bonds worth ₹695.34 crores, when the Tamil Nadu, Puducherry, West Bengal, Assam and Kerala polls were in full swing.

More in the news:

  • According to the RTI reply, the amount sold was the highest-ever for any Assembly elections since the scheme started in 2018.
  • The sale shot up during the elections in comparison to the previous tranche in January 2021 when bonds worth ₹42.1 crores were sold.
  • In the 16th phase of the scheme, 972 out of the 974 electoral bonds were cashed, with over half the amount ₹ 351 crores being encashed at the New Delhi branch.
  • The SBI declined to name the political parties that encashed the bonds, citing it was “third party personal information” that was exempted under the RTI Act.
  • The bank also declined to share the details of how much commission it had earned from the sale of bonds since 2018, giving the reason that the information was of “commercial confidence in nature” and its disclosure would “harm the competitive position of the bank”. 
    • However, SBI was the only bank authorised to sell electoral bonds by the government.

Related Facts:

Electoral Bond:

  • It’s a bearer instrument like a promissory note (Similar to a banknote that is payable to the bearer on demand and free of interest).
  • The scheme allows any Indian citizen or company to purchase the bonds sold by the SBI in denominations of ₹1,000, ₹10,000, ₹1 lakh, ₹10 lakh and ₹1 crore (without any upper limit) and give them to political parties anonymously.
  • The bonds are available for purchase by any person (who is a citizen of India or incorporated or established in India) for a period of ten days each in the months of January, April, July and October as may be specified by the Central Government.
    • The individual can buy the bond, either singly or jointly with other individuals.
    • The donor name is not mentioned on the bond.
  • It is redeemable in the designated account of the registered political party.
    • Registered under Section 29A of the Representation of the People Act, 1951 and which secured not less than 1% of the votes polled in the last General election to the House of People or the Legislative Assembly of the state are eligible for such bonds.
  • The bond is valid for 15 days from the date of issue and no payment will be made after the expiry of the bond.

Right To Information Act 2005:

  • It empowers ordinary citizens to question the government and its work.
  • This has been widely used by citizens and media to uncover corruption, progress in government work, expenses related information, etc.
  • The genesis of RTI law started in 1986, through the judgement of the Supreme Court in Mr. Kulwal v/s Jaipur Municipal Corporation case:
    • In this case, it was directed that  freedom of speech and expression provided under Article 19 of the Constitution clearly implies the Right to Information, as without information the freedom of speech and expression cannot be fully used by the citizens.

Third-Party Information under RTI act 2005.

  • Section 2(n) of the RTI Act 2005 defines ‘Third Party’ as a person other than the citizen making a request for information and includes a ‘public authority’. 
    • If an RTI application asks for any information other than Appellant or Respondent, information cannot be provided until the ‘third party’ consents to disclosure are given.
  • Section 11 (1) the Act provides the procedure to access third party information wherein the appellant needs to request for the third party’s consent after which the CPIO will produce a written request to the third party and within a stipulated time period obtain their response. 
  • Unless the public information officer sees a ‘larger public interest’ in the disclosure of such information, it cannot be revealed.

Exemption from disclosure of information under RTI Act 2005:

  • Under Section 8(1) and Section 9 of the Act:
    • Unless the public authority is able to demonstrate that information sought for falls under any of the exempted categories of information, it would be bound to provide the information and that reasons for rejection of requests for information must also be clearly provided.
    • Exemptions are:
      • Information of messages intercepted in the interests of the sovereignty and integrity of India.
      • Relating to military movements and operations.
      • Information relating to ammunition issued to police officers during a specific time period.
      • Strategic defence secrets plans.
      • Information published during a conflict.
    • Disclosure of information about working, regulations, exchange rates, interest rates, taxes etc. of financial institutions is not under exemptions. However such information in some cases could harm the national economy.
    • This section says that lower-level economic and financial information, like contracts and departmental budgets, should not be withheld under this exemption.

Source: The Hindu, The Indian Express.