Published On: July 31, 2026
Authored By: Snigdho Dhar
University of Engineering and Management, Kolkata
Case Citation and Basic Information
Case Name: Association for Democratic Reforms v. Union of India
Court: Supreme Court of India
Bench: Chief Justice D.Y. Chandrachud, Justice Sanjiv Khanna, Justice B.R. Gavai, Justice J.B. Pardiwala and Justice Manoj Misra
Date of Judgment: 15 February 2024
Citation: 2024 INSC 113 (also reported at (2024) 5 SCC 1)
Nature of Case: Writ petitions under Article 32 of the Constitution challenging the validity of the Electoral Bond Scheme, 2018 and related statutory amendments.
Background
Free and fair elections are the foundation of a democracy, and transparency in funding is essential to ensure that citizens can make informed choices during elections. The Electoral Bond Scheme was introduced by the Government of India in 2018 to reform political funding, allowing individuals and companies to donate to political parties through special bonds. The scheme faced criticism on the ground that it permitted anonymous donations and gave disproportionate influence to corporations. Several petitions were filed before the Supreme Court challenging the scheme. In this landmark judgment, the Court struck down the Electoral Bond Scheme as unconstitutional, holding that anonymous donations through electoral bonds violated citizens’ right to information.
Facts of the Case
The Electoral Bond Scheme was introduced in January 2018 and allowed individuals to purchase bonds from the State Bank of India, which could then be donated to political parties. To implement the scheme, several laws were amended, including changes that exempted political parties from disclosing donations received through electoral bonds and removed the existing cap on corporate donations. Civil society organisations, including the Association for Democratic Reforms (ADR) and Common Cause, challenged these amendments before the Supreme Court, arguing that the scheme undermined transparency and enabled anonymous corporate funding of political parties.
Legal Issues
The legal issues before the Court were whether the Electoral Bond Scheme violated citizens’ right to information; whether the amendments made to the relevant laws were constitutionally valid; and whether unlimited and anonymous corporate donations infringed the principles of free and fair elections.
Arguments Presented
Petitioners’ Arguments
The petitioners argued that voters have a right to know the sources of political funding, and that the scheme permitted anonymous donations that gave disproportionate power to corporations.
Respondents’ Arguments
The Union Government defended the Electoral Bond Scheme, arguing that it was introduced to reduce the use of unaccounted cash in political funding, and that donor anonymity was essential to protect contributors from potential victimisation.
Court’s Reasoning and Analysis
The Supreme Court unanimously struck down the Electoral Bond Scheme, holding that democracy depends on an informed electorate. The Court reiterated that the right to information is part of the freedom of speech and expression under Article 19(1)(a) of the Constitution, and rejected the government’s argument that donor anonymity outweighed the public’s right to information. It held that the restrictions imposed by the scheme were not proportionate to the stated objective of curbing black money in political funding.
Judgment and Ratio Decidendi
The Supreme Court unanimously held that the Electoral Bond Scheme, 2018 is unconstitutional; that the corresponding amendments to the Representation of the People Act, 1951 and the Companies Act, 2013 are unconstitutional; and that the scheme violates the right to information. The Court directed the State Bank of India to stop issuing electoral bonds immediately and to provide details of all electoral bond transactions to the Election Commission of India.
Analysis
Significance of the Decision
The judgment is a significant constitutional decision that reinforces the principle that transparency is essential to democratic governance. It strengthens institutional integrity by ensuring greater openness in political financing.
Implications and Impact
The judgment is likely to influence future reforms concerning political finance and electoral transparency, and may encourage Parliament to devise mechanisms that balance donor privacy with public accountability.
Critical Evaluation
While the judgment has been widely welcomed, some commentators have argued that complete disclosure may discourage donors from contributing through legitimate channels. The Court’s judgment, however, did not itself formulate a framework for future political funding reforms, leaving this task to Parliament.
Conclusion
Association for Democratic Reforms v. Union of India is a milestone in India’s electoral jurisprudence. The Supreme Court reaffirmed that transparency, accountability and informed citizen participation are essential features of democracy, underscoring that political parties cannot remain insulated from scrutiny regarding their sources of funding.
References
1. Association for Democratic Reforms v. Union of India, 2024 INSC 113; (2024) 5 SCC 1.
2. Constitution of India, 1950.
3. Representation of the People Act, 1951.
4. Companies Act, 2013.
5. Finance Act, 2017.
6. Electoral Bond Scheme, 2018.
7. Union of India v. Association for Democratic Reforms, (2002) 5 SCC 294.
8. People’s Union for Civil Liberties v. Union of India, (2003) 4 SCC 399.
9. M.P. Jain, Indian Constitutional Law (LexisNexis).
10. V.N. Shukla, The Constitution of India (Eastern Book Company).
