Supreme Court dismisses SBI plea seeking extension of deadline to furnish details on electoral bonds

The Supreme Court on Monday dismissed a plea by the State Bank of India (SBI) to extend the deadline set by the top court for furnishing details of electoral bonds encashed by political parties since April 12, 2019 [Association for Democratic Reforms and Anr vs Union of India Cabinet Secretary and ors]..The apex court had set the deadline as March 6 and the SBI had moved the Court seeking extension till June 30 to comply with the Court's directions. However, a five-judge Constitution bench of Chief Justice of India (CJI) DY Chandrachud with Justices Sanjiv Khanna, BR Gavai, JB Pardiwala and Manoj Misra rejected the bank's plea and ordered that the details be disclosed by March 12. "The submissions of SBI in the application sufficiently indicate that the information which has been directed to be disclosed by this Court is readily available ... the Miscellaneous Application filed by the SBI seeking an extension of time for the disclosure of details of the purchase and redemption of Electoral Bonds until 30 June 2024 is dismissed. SBI is directed to disclose the details by the close of business hours on 12 March 2024" the Court ordered.The bench also cautioned SBI of contempt of court in case it fails to comply with the Court's direction. "We are not inclined to exercise the contempt jurisdiction at this stage bearing in mind the application which was submitted for extension of time. However, we place SBI on notice that this Court will be inclined to proceed against it for willful disobedience of the judgment if SBI does not comply with the directions of this Court," the order said.The bench passed the order after noting that the Electoral Bonds scheme - which was struck down by the top court last month - had itself stipulated that the information furnished by the buyer of such bonds shall be treated as confidential by the authorised bank and shall be disclosed when called upon to do so or registration of an offence by a law enforcement agency."Thus, in terms of the provisions of the Electoral Bond Scheme itself, SBI is mandated to disclose information when demanded by a court" the Court said.Further, the Court noted that the details to be disclosed are readily available with the SBI."The details of the Electoral Bonds which have been purchased and which have been directed to be disclosed by this Court are readily available ... Thus, information about a political party’s encashment of Electoral Bonds would only be stored in these branches which would be clearly accessible," the order said.Further it noted that the Frequently Asked Questions (FAQ) published by the SBI with respect to redemption of electoral bonds states that each political party can only open one current account for electoral bonds redemption. "The current account could be opened by the political party only in twenty-nine designated branches all over the country ... The authorized branches must submit the pay-in-slip and other details to the main branch. There is no dispute about the fact that this process was duly followed", the bench observed while rejecting SBI's plea..The electoral bonds scheme allowed donors to anonymously send funds to a political party after buying bearer bonds from the State Bank of India (SBI).It was introduced introduced through the Finance Act, 2017, which in turn amended three other statutes - the Reserve Bank of India Act, the Income Tax Act and the Representation of People Act.Various petitions were filed before the top court challenging at least five amendments made to different statutes through the Finance Act, 2017 on the ground that they have opened doors to unlimited, unchecked funding of political parties..On February 15 this year, the Constitution Bench unanimously quashed the Electoral Bonds Scheme and directed SBI to submit the details of the political parties that have received contributions through electoral bonds from April 12, 2019, to the Election Commission of India (ECI).The Court in that judgment ordered that details of each electoral bond encashed by political parties must be furnished by the SBI to the ECI by March 6.The following were the details that SBI was required to furnish:- Details of each electoral bonds purchased;- Name of purchaser; - Denomination of electoral bonds; and - Details of each electoral bond redeemed by political parties including the date of encashment. The ECI was to then publish this information on its official website within one week of receiving this information from the SBI.However, the SBI then filed the present application before apex court for an extension till June 30 to comply with the directions. Meanwhile, the petitioners in the case also filed contempt of court pleas against the SBI..Senior Advocate Harish Salve appeared on behalf of SBI today, and said that the bank would need some more time to furnish details since they were initially told that the process was secret before the top court struck down electoral bonds scheme. "We are trying to collate the information and we are having to reverse the entire process. We as a bank were told that this is supposed to be a secret," he submitted.The Court, however, said that for every purchase of electoral bonds, there was compliance with Know Your Customer (KYC) process in which case, the bank would already be in possession of the details of purchasers of electoral bonds."The FAQs indicated that for every purchase there has to be a separate KYC. So, you have the details already," the CJI remarked. "You have to just open the sealed cover, collate the details and give the information. ECI was asked to file details in a sealed envelope," Justice Khanna weighed in."I have full details on who purchased the bond and I have full details from where the money came from and which political party tendered how much. I have to also now put the name of purchasers. The names have to be collated, crosschecked with the bond numbers," Salve replied.An interesting exchange then ensued with Salve maintaining that more time would be required for the process with the court disputing the same. ."The moment we have to give the names with bond numbers, that is creating the problem," Salve said."Please tell what matching you have done in the last 26 days," the CJI asked."We can submit a detailed affidavit," responded Salve."There is a degree of candour expected from SBI - as to this is the work which was expected and this has been done," the Court said."Work is done like form to form. It will take three months more. I cannot make the mistake, else I will be sued by donors, etc.," Salve insisted."You accept that there is no difficulty in giving details of who purchased, etc. ... So in 26 days, at least 10,000, etc. must have been collated," said Justice Khanna. Pertinently, the Court said that the ECI had already placed a lot of details before the Court in sealed cover during the hearing of the main case, and the Court will now open the same."ECI had filed details on what was there before him and it was placed in silos before us. So now we will open before us. ECI can now divulge the same here and then SBI can do so. We will direct ECI submission to be opened in the open court. So we will know who gave what. We will ask Court to make digitised copy of it and make it accessible. We did not refer it to during the judgment," the CJI said..The SBI had submitted that the process of decoding electoral bonds and relating donor to the donee is a time consuming exercise and that such information is not available in digital format.The Court also noted the submission of the SBI that clause 7.1.2 of an SOP regarding the sale and redemption of electoral bonds stipulated that no details of bond purchasers, including Know Your Customer (KYC) and other details, would be entered into the core banking system. Thus details of the purchasers of bonds were not available centrally, the SBI submitted. Donor and recipient details were in two different silos, the bank informed."There is a large number of data sets to decipher and a total of 22,217 bonds were purchased between April 2019 to February 2024. This will lead to 44,000 plus data sets since there are two silos of information. Thus compilation will be time consuming process," the SBI argued.However, the Court refused to buy these arguments and dismissed the bank's plea..[Read order]