Why in news
The Supreme Court declined to form a Special Investigation Team (SIT) led by a former judge to investigate "quid pro quo"(a favor for a favor) allegations related to electoral bonds.
The court found it both ‘premature’ and ‘inappropriate’ to constitute an SIT to probe the allegations as there are other remedies available in law
What is electoral bonds
The electoral bonds system was introduced in 2017 by way of a Finance bill and it was implemented in 2018.
They serve as a means for individuals and entities to make donations to registered political parties while maintaining donor anonymity.
State Bank of India issues the bonds in denominations of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh, and Rs 1 crore
Payable to the bearer on demand and interest-free
Purchased by Indian citizens or entities established in India.
Can be bought individually or jointly with other individuals.
Valid for 15 calendar days from the date of issue.
SBI is the authorized issuer.
Electoral Bonds are issued through designated SBI branches
Eligibility of Political Parties:
Only the political parties registered under Section 29A of the Representation of the People Act, 1951.
Political Parties have secured not less than 1% of the votes polled in the last general election to the House of the People or the Legislative Assembly, are eligible to receive electoral bonds.
Electoral Bonds can be purchased digitally or through cheques.
Encashment only through an authorized bank account of the political party.
Parties must disclose their bank account with the Election Commission of India.
Donations are made through banking channels, ensuring transparency.
Political parties are obligated to explain the utilization of the funds received.
Benefits:
Enhanced transparency in political party funding.
Accountability in disclosing donation utilization.
Discouragement of cash transactions.
Preservation of donor anonymity.
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