Adieu, Democracy!

Shrishti S, III Year B. A. History.

In February 2017, Finance Minister Arun Jaitely made an astonishing move by capping the donations that political parties receive at Rs. 2000 to make the system of political funding more transparent. In this war against corruption, all parties are now supposed to accept funding only via digital platforms with appropriate records. Parties are not required to reveal the names of individuals or organizations making any donation below Rs. 20,000. But they need to mention them in the Income Tax returns. An average Indian citizen would have been more surprised by this move than at their own surprise birthday party.

All that glitters is not gold, and as the rain stopped, green meadows were replaced with mucky soil. Mr. Jaitely, much like the party-pooper at said surprise party, announced an amendment to the Companies Act, 2013 to remove the cap that barred a company from donating more than 7.5 per cent of its average net profit in the three immediately preceding financial years to a political party. It also removed a requirement that made it obligatory for a company to disclose in its profit and loss statement the name of the party to which the donation has been made. So, it’s a weak armour against corruption, rather like a bottle of Nimbooz – does not contain real lemon juice; it is artificially flavoured.

“This means, for example, that an infrastructure firm could theoretically pay up to 50 per cent of its net profits to a single party, as donation, without anyone getting wiser as to which party has been paid… this throws open the possibility that an order to build a highway or a railway bridge could be given to a firm and that firm could pay the donation to the party in power which placed the order with it,” said a senior official with the Comptroller and Auditor General’s office. Audit statements issued by companies will just state political donations, without mentioning the party to which the donation has been made.

This ‘innocent’ amendment made it to the Finance Bill 2017 in Section 182 of the Companies Act, 2013. It says, “in sub-section (I) – (a) the first proviso will be omitted”. While this seems an innocent deletion of a section, in effect it removes the cap on political donations which till now stipulated that the aggregate amount contributed by a company in any financial year shall not exceed 7.5 per cent of its average net profits in the preceding three financial years.

Usually, legal provisions in India are mere words on paper. However, this move was an open challenge to democracy, as companies can affect both the public support and the financial funding of political parties in turn for their vested interests. Transparency is nothing but a concept under the broad, cracked aegis of democracy. The government has taken the concept of blind justice much too seriously. The scales weigh money while the government cannot see who is weighing it. As we usher the new budget for the year 2017-2018, the writer bids an unfortunate farewell to democracy.

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