The NGO Common Cause on Wednesday moved the Supreme Court seeking a court-monitored probe by a special investigation team (SIT) into alleged instances of quid pro quo over electoral bonds involving political parties, corporate entities and officials of central agencies.

“The electoral bond data that has been revealed shows that the bulk of the bonds appear to have been given as quid pro quo arrangements by corporates to political parties for… getting contracts/ licences/ leases/ clearances/ approvals worth thousands and sometimes lakhs of crores and other benefits from the governments or authorities controlled by the governments which were in turn controlled by the political parties that received those bonds,” the petition filed through advocate Prashant Bhushan stated.

“Electoral bonds given in close proximity to action by agencies like the ED/ IT/ CBI raising suspicion of it being ‘protection’ money to avoid/stall action by or in exchange for regulatory inaction by various regulators like the drug controller etc and electoral bonds given as a consideration for favourable policy changes,” it stated.

According to the petition, these “payoffs” appear to have influenced contracts worth lakhs of crores and regulatory inaction by central agencies.

In several cases, the donations appear to have been made in blatant violation of the regulatory framework governing contributions by companies to political parties, the petition added.

Bhushan said Section 182(1) of the Companies Act prohibits companies that have been in existence for less than three years from making contributions to political parties. Yet the data on electoral bonds shows that at least 20 companies bought poll bonds within three years of their incorporation. In some cases, the companies were just a few months old when they purchased bonds, Bhushan said.

“Data has further shown that various loss-making companies and shell companies were donating huge sums to political parties through electoral bonds. Data suggests that the introduction of electoral bonds led to the mushrooming of shell companies, which were used by D corporate houses as conduits to launder illicit money,” the petition said.

“This is evident from the fact that many companies having little or no profits gave large donations to many political parties, especially the ruling party. In this way, laundered money has found its way into the coffers of the political parties. The source of funds donated by these shell companies is unknown and a matter of investigation, since the names and KYC status of these companies have evidently been used by other entities to launder their illicit money and curry favour with the political parties in power,” it added.

The NGO said the CBI, Enforcement Directorate and the income tax department appeared to have become accessories to corruption.

“Several firms which were under investigation by these agencies have donated large sums of money to the ruling party, potentially to influence outcomes of probes. Thus, the investigation in this case would not only need to unravel the entire conspiracy in each instance, which would involve officers of the company, officials of the government and functionaries of political parties but also the officers concerned of agencies like the ED/IT and CBI etc, who appear to have become part of this conspiracy.

“Hence, this scam needs to be investigated by an SIT of sitting/retired investigating officers of impeccable integrity chosen by this Court and working under the supervision of a retired judge of this Hon’ble Court,” the petition argued.

A five-judge constitution bench of the Supreme Court had in a historic verdict
on February 15 struck down the Centre’s electoral bonds scheme as illegal and unconstitutional.