Thursday, September 16, 2021
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No consensus among parties on disclosure of donations

Political parties have failed to arrive at an agreement on a Law Commission recommendation making it mandatory to disclose donations less than Rs 20,000 if the total amount exceeds Rs 20 crore.

There was also a “lack of agreement” on penalties for non-submission of details on contributions by parties. The Election Commission, quoting parties, said the proposed Rs 50 lakh penalty for filing of false information was considered too high, especially for small parties.

The EC has come out with a draft outcome paper based on the March 30 consultations on political finance and the latest Law Commission report on electoral reforms.

The document, quoting parties, said the Law Commission recommendation on disclosures is “not practicable for parties.”

The parties also felt that disclosure of contributions lower than Rs 20,000 is not advisable.

The Law Commission had last month proposed to make it mandatory for political parties to also disclose contributions less than Rs 20,000 if such contributions exceed Rs 20 crore or 20 percent of the party’s total contributions, whichever is less. For this purpose, the commission has recommended amendments to the relevant election rules as well as the Income Tax Act.

On the issue of the proposed Rs 50 lakh penalty, participants wanted clarity on what constitutes ‘false information?.

There were questions in the meeting on whether it only be linked to falsification of disclosure of contributions or any incorrect information such as errors in name and address.

There were also divergent views on the law panel’s recommendation on shareholder approval for deployment of company funds for political purposes.

Some participants felt that pre-donation approval may not be possible in the current climate. However, some suggested that post facto ratification of donations may be allowed to ensure transparency.

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