In its written letter to Union Law Minister Kiren Rijiju, the CEC proposed to cap cash donations at 20% or Rs 20 crore, whichever is lower, sources told Reuters. ANI.
The electoral commission has proposed to increase anonymous political donations from Rs 20,000 to Rs 2,000 to clean up election funding from black money, sources said on Monday.
In the letter, the CEC recommended a series of amendments to the Representation of the People (PR) Law.
According to the proposal, political parties are not required to declare money received below Rs 2000.
In accordance with the rules currently in force, political parties must disclose all donations above Rs 20,000 through their contribution report which is submitted to the Electoral Commission.
The move comes against the backdrop of the polling panel which recently deregistered 284 defaulting and non-compliant Unrecognized Registered Political Parties (RUPPs), declaring more than 253 of them inactive.
Currently, there is a discrepancy between the Income Tax Act and the Representation of the People Act 1951 regarding the upper limit for anonymous cash donations. While Section 13A of the Income Tax Act as amended in 2017 stipulates that no cash donation above Rs 2,000 shall be received by a political party, Section 29C of the RP law requires political parties to only report details of donations made by check or other banking means. journey above Rs 20,000. This basically means that parties do not need to declare donations received by cheque/draft/electronic authorization, between Rs 2,000 and Rs 20,000.” The EC has requested that this anomaly be rectified by amending Section 29C of the PR Act,” a source told TOI.
Another key reform proposed by the EC is the legal backing of its instructions requiring candidates to maintain a separate bank account for election expenses, by amending Rule 89 of the Rules of Conduct for Elections, 1961. It wants digital transactions or transfers of checks from the beneficiary of the account be made mandatory. for all expenses above Rs 2,000 to a single entity/person.
The EC has also called for reforms to ensure foreign donations do not reach political parties through the back door, in violation of the Foreign Contributions Regulation Act 2010. Sources said that currently there is no mechanism to segregate foreign donations at the initial stage, and the current contribution report format is “not equipped” to seek additional information. There are also concerns about the violation of foreign exchange provisions.
Earlier this month, the Income Tax Department conducted raids in several states as part of an India-wide investigation into tax evasion against certain Unrecognized Registered Political Parties (RUPPs) and their alleged questionable financial transactions. The action was taken by the department on a recent recommendation from the Election Commission which recently delisted at least 198 entities from its RUPP list after they were found non-existent during a physical check.
The polling panel had announced that it was taking action against more than 2,100 entities, classified as RUPP by it, for flouting election rules and laws, including those related to the filing of monetary contributions, failing to put update their address and the names of the members of the office.
(With agency contributions)