Make disclosure of donations worth over Rs 2,000 mandatory: Election Commission writes to govt | India News

NEW DELHI: The Election Commission has written to the law ministry proposing mandatory disclosure of all contributions received by political parties in excess of Rs 2,000, instead of the current threshold of Rs 20,000, besides seeking the capping of cash donations to a party at 20% of total contributions received by it or Rs 20 crore, whichever is less.
Chief election commissioner Rajiv Kumar, seeking to carry forward the EC’s ongoing action against alleged financial improprieties by registered unrecognised political parties (RUPPs), recently wrote to law minister Kiren Rijiju mooting amendments in the election law and rules that require all parties — including recognised national and state parties — to maintain a higher level of transparency in their funding and curb the use of ‘black money’ in elections. The proposed upper limit on cash donations — 20% of the party’s total contributions or Rs 20 crore, whichever is less — is a step in this direction, said a source.
Currently, there exists an anomaly between the Income Tax Act and Representation of the People Act, 1951 regarding the upper limit on anonymous cash donations. While Section 13A of Income Tax Act, as amended in 2017, states that no cash donation exceeding Rs 2,000 shall be received by a political party, Section 29C of R P Act requires political parties to only declare details of donations made by cheque or any other banking route in excess of Rs 20,000. This essentially means that parties need not declare donations received by cheque/draft/electronic clearance, between Rs 2,000 and Rs 20,000. “The EC has sought this anomaly to be corrected by amending Section 29C of the R P Act,” said a source.
Another key reform proposed by EC is legal backing for its instructions requiring candidates to maintain a separate bank account for election expenses, by amending Rule 89 of Conduct of Election Rules, 1961. It wants that digital transactions or account payee cheque transfers should be made mandatory for all expenses above Rs 2,000 to a single entity/person.
The EC has also sought reforms to ensure that foreign donations do not reach political parties through the backdoor, in violation of the Foreign Contribution Regulation Act, 2010. Sources said that at present, there is no mechanism to segregate foreign donations at the initial stage, and that the present format of contribution report is “not equipped” to seek additional information. There is also concern over violation of foreign exchange provisions.

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