Why the largest PSB should be singled out.

Singling out the largest PSB in the electoral bonds issue: Unfortunate 

The then Finance Minister, who brought the electoral bonds scheme (EB) in 2017, was a reputed senior advocate of the Supreme Court of India (SC). As a FM during the first term of NDA in 2014-19, he is also accredited with the implementation of GST, insolvency and Bankruptcy Code (IBC), Demonetisation, merger of railway budget with general budget, etc. When the electoral bonds scheme was introduced and implemented as part of Money Bill, both the Houses of Parliament had reputed legal counsels of SC as MPs. The scheme was rolled out, even after RBI pointed out that PML Act 2002 will be compromised, as identities of intervening persons in the electoral bonds, which are bearer instruments, might not be known at all, though identity of original purchaser is established due to compliance of KYC. Its suggestion that the need of electoral bonds can be accomplished through the existing physical and digital payments was also not taken note of.

The political parties including those, which objected to the scheme at that time, were however not averse to accepting the donations through the scheme, as revealed now through encashment details of EBs. From the news reports, some of the major purchasers of the EBs contributed more than five times their PAT during 2021-22 and 2022-23.

All the above events relating to EB scheme is not seen commented in a big way by all concerned, who single out the largest public sector bank (PSB) as not coming out with full details.

While it is true that the said PSB, authorised to issue and encash the bonds, sought for extension of time originally, it complied with the direction of SC immediately, when it was asked to do so. Regarding the unique alphanumeric and serial numbers, the bank’s senior legal counsel  submitted that the bank has no reservation in disclosing all details, which are in its possession and custody. SC ruled that all details in the possession and custody of the bank shall be disclosed and an affidavit to this effect should be filed by the bank’s Chairman on or before 5 PM on 21st March 2024. The matter rests there for compliance by the bank.

During the course of his submission, the senior legal counsel, appearing on behalf of the bank, remarked that the bank had no compunction whatsoever to disclose every detail on the electoral bonds, as his client is a public institution. He also remarked that an impression is being created outside that the bank is playing ducks and drakes with the SC, which is not true. I tend to agree with him.

Regards.

V. Viswanathan 

19th March 2024.

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