MOOT COURT COMPETITION

BEFORE THE HON’BLE SUPREME COURT OF BHARAT

NADU

DEMOCRATICREFORMS PROJECT& OTHERS

Vs.

UNION OF BHARAT NADU

MOST RESPECTFULLY SUBMITTED BEFORE THE JUDGE OF THE

HON’BLE SUPREME COURT AT BHARAT NADU

MEMORANDUM ON BEHALF OF THE RESPONDENT

 TABLE OF CONTENTS

SL.NO. CONTENTS PAGE

NO.
1 List of Abbreviations
2 Statement of Jurisdiction
3 Issues Raised
4 Arguments Advanced
1. Whether the electoral bond scheme violates the basic structure of
the Bharat Nadu Constitution.
2. Whether the denial of information about purchasers of Electoral
Bonds by Bharat Nadu Daan Bank is justified.
3. Whether the decision of the Speaker of the Upper House certifying
a bill as 'Money Bill' amenable to judicial review .
4. Whether the impugned legislation is a money bill under Article 110
of the Bharat Nadu Constitution.
5. The consequential amendments made to different legislations in
pursuance of PCRA are invalid.
5 Prayer

LIST OF ABBREVIATIONS
AIR All India Reporter
AII Allahabad High Court
Art. Article
Cri LJ/ Cr LJ Criminal Law Journal
Del. Delhi High Court
 Ed. Edition
BOM. Bombay High Court
MAD. Madras High Court
FCRA Foreign Contribution (Regulation) Act, 2010
RPA Representation of People’s Act, 1951
SC Supreme Court
SCC Supreme Court Cases
SCJ Supreme Court Journal
SCR Supreme Court Reporter
Sec. Section
V. Versus
PDRA Political Donation (Regulation Act)

STATEMENT OF JURISDICTION
The petitioner has approached this Hon’ble Court under Article 32 of the Constitution of
Bharat Nadu-

Article 32. Remedies for enforcement of rights conferred by this Part

(1)  The right to move the Supreme Court by appropriate proceedings for the enforcement of
the rights conferred by this Part is guaranteed
(2)  The Supreme Court shall have power to issue directions or orders or writs, including
writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari,
whichever may be appropriate, for the enforcement of any of the rights conferred by this Part
(3)  Without prejudice to the powers conferred on the Supreme Court by clause ( 1 ) and ( 2 ),
Parliament may by law empower any other court to exercise within the local limits of its
jurisdiction all or any of the powers exercisable by the Supreme Court under clause ( 2 ).
(4)  The right guaranteed by this article shall not be suspended except as otherwise provided
for by this Constitution.

ISSUES RAISED
The following questions are presented before the Hon‘ble court in the instant matter:
I.

WHETHER THE ELECTORAL BOND SCHEME VIOLATES THE BASIC

STRUCTURE OF THE BHARAT NADU CONSTITUTION.

II.

WHETHER THE DENIAL OF INFORMATION ABOUT PURCHASERS OF

ELECTORAL BONDS BY BHARAT NADU DAAN BANK IS JUSTIFIED.

III.
 WHETHER THE DECISION OF THE SPEAKER OF THE UPPER HOUSE
CERTIFYING A BILL AS 'MONEY BILL' AMENABLE TO JUDICIAL
REVIEW.

IV.

WHETHER THE IMPUGNED LEGISLATION IS A MONEY BILL UNDER

ARTICLE 110 OF THE BHARAT NADU CONSTITUTION.

V.

THE CONSEQUENTIAL AMENDMENTS MADE TO DIFFERENT

LEGISLATIONS IN PURSUANCE OF PCRA ARE INVALID.

ARGUMENTS ADVANCED

1) The Electoral Bond Scheme is not in violation of the basic structure of the
Constitution of Bharat Nadu?
It is humbly contended by the counsel, on behalf of the Respondent, that the
enactment of the PCRA has not violated any of the essential features of the
Constitution of Bharat Nadu that fall under the umbrella of the ‘basic structure’
for the reasons that [A.] by incorporating the Electoral Bond Scheme to provide
political funding through recognized and legitimate channels , an equal playing
field will be provided to election contenders , thereby fostering democracy,[B.]
that there has been no infringement of fundamental rights and consequentially ,
no violation of the basic structure of the Constitution ,[C.] that disclosing the
 names and details of donors shall strike a blow to the necessity of maintaining
confidentiality with respect to the identity of the voters and [D.] that the scheme
sustains the interest of the public to vote without any fear of suppression or
political threat.

A) Democracy is not hindered by way of enactment of PCRA.

The counsel humbly contends that the democratic design of Bharat Nadu has
been recognized as one of the essential features that are comprised in the
understanding of ‘basic structure’ as laid down in the landmark decision of the
Hon’ble Supreme Court in the matter of KesavanandaBharatiSripadagalvaruv.
State of Kerala.1The Court, in this case, has in clear words, upheld democracy
and the republican structure of the country as one of its indomitable features .
Also, in Indira Nehru Gandhi v. Raj Narain,2 the Supreme Court stated that
democracy is an unassailable element of the Constitution . However, of
relevance, is the following observation of the Court that any amendment cannot
be termed to be unconstitutional or authoritarian for the sole reason that it
intends to bring forth certain changes to the concept of democracy that was
known since its very inception . A change to the concept cannot be negated on a
prima facie basis if only it attempts to bring in improvisations and not an entire
overhaul to what one understands to be, democracy. As long as democracy is
preserved in principle, changes may be a need of the transforming time.
The counsel believes that the PCRA shall bring in more accountability in the
election process, thereby, strengthening democracy, as opposed to abridging or
annihilating it. It is most important that elections are conducted in a fair and
impartial manner, with every interested party being made available with the
same set of opportunities and challenges. The PCRA shall ensure systematic and
traceable donations made to political parties which will remove unregulated and
questionable sources and channels of political donations significantly . With a
transparent system in place, no party shall be bestowed with unaccounted wealth
at his disposal which he may utilize to influence voters using unacceptable

1
KesavanandaBharatiSripadagalvaru v. State of Kerala,AIR 1973 SC 1461, ¶302.
2
Indira Nehru Gandhi v. Raj Narain, 1975 AIR 865,¶672.
 norms thereby laying down the foundation for an equal playing field for all
political candidates alike irrespective of their political party affiliations.3

B) Fundamental Rights under the Constitution are part of the basic structure
The counsel humbly contends that certain fundamental rights as found to be
enshrined under Part III of the Constitution of Bharat Nadu have been
recognized as a significant part of the basic structure of the Constitution . In the
words of the Hon’ble Supreme Court in Minerva Mills Limited v. Union of
India4, fundamental rights, in their truest sense, are inalienable, primordial and
transcendental rights which have been referred to as the ‘ark of the
Constitution’5.Also, the Apex Court, in I.R. Coelho v. State of Tamil Nadu6 has
reiterated the position of law laid down in KesavanandaBharati (supra)7 and
Indira Gandhi (supra)8 case to the effect that,“…fundamental rights are
interconnected and ... form part of the basic structure as reflected in … Art. 21
read with Art. 14….”This observation of the court suggests that a violation of
the basic structure can occur when there is an infringement or attempt to
abrogate the fundamental rights prescribed under Art.14 and 21 of the
Constitution of Bharat Nadu. However, the counsel, shall by way of the
following arguments highlight before this Hon’ble Bench that the enactment is
not, in any manner, attempting to infringe on the fundamental rights under the
Constitution and is in compliance with the provisions of the Constitution.

C) There has been no abrogation of the fundamental right of equality enshrined

under the Constitution
Art. 14 of Constitution of Bharat Nadu enunciates that “The State shall not deny
to any person equality before the law or the equal protection of the laws within
the territory of India”. Equal protection means the right of being equally treated
in similar circumstances9 both in terms of conferred privileges and imposed

3
Kanwar Lal Gupta v. Amar Nath Chawla, (1975) 3 SCC 646.
4
Minerva Mills Limited &Ors.v. Union of India &Ors., AIR1980SC1789,¶60.
5
Supra note 1, at ¶1356.
6
I.R. Coelho (Dead) by L.Rs. v. State of Tamil Nadu &Ors., AIR2007SC861, ¶65.
7
Supra note 1.
8
Supra note 2.
9
Shrikishan v. State of Rajasthan, (1955) 2 SCR 531.
 liabilities by law10.In M.G Badappanavan v. State of Karnataka11 it was held
that “Equality is a basic feature of the Constitution of India and any treatment
of equals unequally or unequals as equals will be violation of the basic
structure of the Constitution of India”.The doctrine of equality before law is a
necessary corollary of the doctrine of Rule of Law as propounded by the jurist ,
A.V. Dicey. This Rule of Law pervades the Indian Constitution as was held in
the case of Ashutosh Gupta v. State of Rajasthan.12 In Dalmia Cement
(Bharat) Ltd. v. Union of India13, the Apex Court held that the constitutional
principle of equality before law is inherent in the rule of law when they are
applied evenly among equals without accommodating any bias or irrational
distinction.14
In the facts of the present case, the Electoral Bond Scheme which includes the
non-disclosure of the names of the donor has clearly established conformed to
the the definition of equality under Art . 14 which states that equality defined
under the said Article is not equality among all but it is a qualified equality , only
among equals15. The aspect of non-disclosure of the names of the donors and
maintaining anonymity in donations under the PCRA upholds the citizens’ right
to equality as secrecy in voting is a right that is to be necessarily secured to
every citizen of the nation by the government administrators of the country . The
counsel contends that from a practical standpoint, a person shall, in all
probability, be expected to vote for a candidate in whose favour he has made
prior donations. Therefore, if the names of the donors is disclosed , it shall lead
to an automatic breach of secrecy of the voter’s choice of vote that he may cast
in the imminent elections. This will be in violation of the legal position as was
described in PUCL v. Union of India16by the Apex Court in clear and
unequivocal terms that right to secrecy is an integral feature of free and fair
elections.Free and fair elections has been judicially interpreted to form a part of
the basic structure. Every voter must be allowed to vote without any threat of
ramifications, coercion, duress or reprisal at the hands of political parties .If the

10
State of West Bengal v. Anwar Ali, 1952 SCR 284 (320);Sadasiv v. State of Orissa, 1956 SCR 794 (806).
11
M.G Badappanavan v. State of Karnataka, AIR 2001 SC 260.
12
Ashutosh Gupta v. State of Rajasthan, (2002) 4 SCC 34.
13
Dalmia Cement (Bharat) Ltd. v. Union of India, (1996) 10 SCC 104, ¶ 18.
14
DURGA DAS BASU, SHORTER CONSTITUTION OF INDIA 83 (14ed.2013).
15
T.Devadasan v. The Union of India And Anr., 1964 AIR 179.
16
People’s Union of Civil Liberties &Ors. v. Union of India &Ors.,(2014)2SCC(LS)648.
 names of the donors are disclosed, then there will be lucid violation of Art. 14 as
on one hand, the Constitution shall endeavour to provide secrecy and protection
to the identity of the voters’ and the votes cast by them and on the other hand ,
such secrecy shall be compromised by disclosing their names at the time of
making political donations. Therefore, in order to upkeep voters’ confidentiality ,
it must be ensured that the same treatment is meted out even under distinct laws
as is the mandate of right to equality under the Constitution . Protecting voters’
identities under one law and disclosing the same information under the
requirement of another law is an irrational distinction which goes against the
spirit of Art. 14. Therefore, the Electoral Bond Scheme upholds the primary
constitutional guarantee of equality before law and hence , it is fallacious to
believe that this scheme contravenes with rule of law.

D) There has been no abrogation of the fundamental right of right to life

enshrined under the Constitution

Art. 21 of the Indian Constitution lays down that ,“No person shall be deprived of his life
or personal liberty except according to procedure established by law.” The counsel
humbly submits that every voter has a right to vote in a free and fair manner .In order to
underline the importance of free and fair elections which is described as the foundation of
democracy in the nation,the Hon’ble Supreme Court,in the case of
RampakaviRayappaBelagali v. B.D Jatti17 stated that “Free and fair elections are the
very foundation of the democratic institutions and just as it is said that justice must not
only be done but must also seem to be done; similarly , the elections should not only be
fairly and properly held, but should also seem to be so conducted as to inspire confidence
in the minds of the electors that everything has been above board and has been done to
ensure free elections.” The non-disclosure of the names of the voters is the maintenance
of secrecy which is a must and is insisted in democracies where direct elections are
involved in order to ensure that a voter casts his vote without any fear of being victimized
if there is a disclosure of his choice of candidate. In order to continue maintaining secrecy
of the voters’ identity, the Electoral Bonds Scheme is being introduced which enable
anonymous donations in the name of political parties to protect individuals from political
victimisation and coercion.If names of donors are brought into public domain , then there

17
RampakaviRayappaBelagali v. B.D Jatti, 1970 (3) SCC 147.
 shall arise a definite threat to the lives of individuals at the hands of political tyranny ,
threat and coercion. This shall defeat the purpose of Art.21 which purports an unhindered
right to life and personal liberty.

2) The decision of the Speaker of the Upper House certifying a bill as ‘Money
Bill’ is not amenable to judicial review.
It is humbly contended that the aspect of the PCRA which has been passed by
way of a money bill is not justiciable in any court of law . This decision which has
been rendered by the Speaker of the Upper House cannot be deliberated upon by
the judiciary for the reasons that [A.] by virtue of the doctrine of separation of
powers, the Judiciary must exercise restraint in adjudicating over policy decisions
that have been taken by the Legislature and [B.] certification of a bill as Money
Bill by the Speaker is only open to judicial review if there has been an instance of
irrationality, illegality or breach of constitutional provisions as is contrary in the
facts of the present dispute.

A. Judiciary is barred from intervention in the policy decisions drawn up by the

Legislature.
The counsel shall make an endeavor to bring to the kind notice of the Hon’ble
Supreme Court of Bharat Nadu that the country , though shies away from a rigid
conformance, it believes in giving effect to the Doctrine of Separation of Powers 18
in spirits. Even though this doctrine is not strictly enforced , attempt is made to
maintain three distinguished organs of the state , the legislature, the executive and
the judiciary. This doctrine that intends to secure maximum accountability and
transparency in each organ of the state is not found enshrined in any provision of
the Constitution’s text. However, the same has been adopted , in spirit, in the
operation of the country’s polity. This is done in order to hinder an overlap of
functions between the bodies that may give rise to discontentment and an ensuing
tussle. The significance that this doctrine attains in operation has rendered it, the
status of an essential feature of the Constitution of Bharat Nadu . This was
recognized by the Constitutional Bench of the Supreme Court in the landmark
decision of the KesavanandaBharati v. State of Kerala and Anr.19The Court
heralded ‘separation of powers’ to be a part of the basic structure of the
18
MONTESQUIEU, SPIRIT OF LAWS (1748).
19
Supra note 1.
 Constitution only to be reiterated by the Apex Court in the decision of Indira
Gandhi v. Raj Narain20.
In clear words, the Apex Court, in Bhim Singh v. Union of India21 has attempted
to explain the objective behind enabling the practice of this doctrine in the
country. Separation of powers between the three organs of the state allow for the
elaborate distribution of powers between the organs of the legislature, the
executive and the judiciary, this ensures a reasonable check to the possibility of
encroachment, upon the designated powers of one organ, by another as was held
in the Constitutional Bench decision of Ram Jawaya v. State of Punjab22. In the
words of the court, violation of the doctrine of separation of powers shall be when
an essential function of one organ is taken over by another one, thereby leading to
the establishment of predominance of the latter and dilution in the accountability
of the distinguished organs.
An unnecessary intervention, unless there is encroachment over an essential
function of one organ of the state , should not be encouraged. This also applies to
the judiciary which is required to incorporate restraint23 in deliberating upon
matters that fall within the exclusive domain of the legislature ,24 as is in the
present case. The counsel, humbly submits, that when the judiciary is called onto
review a matter involving legislative or executive policy, it must look to ascertain
the policy objectives behind any enactment from the Preamble 25 which is to be
read in the light of the circumstances 26in which it was passed or its object and the
purpose27 for which it was enacted. The provisions must not be read in isolation
but only in conjunction with the true purpose of the enactment and the wrong it
sought to remedy. The counsel humbly contends that the PCRA is the nature of an
economic legislation as it aims to regulate monetary contributions in designated
currency denominations to political parties. Reliance is placed on the ratio of R.K.

20
Supra note 2.
21
Bhim Singh v. Union of India, (2010) 5 SCC 538.
22
Ram Jawaya v. State of Punjab,AIR 1955 SC 549, ¶ 12.
23
Hindi Hitrakshakshamiti and Ors. v.Unoin of India, 1990 AIR 851; Government of Andhra Pradesh and Ors .v.
Smt.P.Lakshmi Devi, 2008 (2) 8 JT 639.
24
Divisional Manager, Aravali Golf Club and Anr.v.Chander Hass and Anr., 2008 (3) 3 JT 221.
25
Kaushal P.N. v. Union of India, AIR 1978 SC 1457.
26
PannalalBinjraj v. Union of India, AIR 1957 SC 397; KathiRanningRawat v. State of Saurashtra, AIR 1952 SC
123.
27
Tika Ramji Ch. v. State of Uttar Pradesh, AIR 1956 SC 676; Ram Bacchan Lal v . State of Bihar, AIR 1967 SC
1404.
 Garg v. Union of India28 wherein it was upheld that economic legislations should
be afforded wider latitudes than other civil laws . The degree of scrutiny needs to
be relaxed when it comes to the former. Economic legislations are crafted majorly
on the basis of empirical data collected. Such acts must be seen in terms of the
purpose they aim to serve. The constitutionality question for the same has to be
adjudged in the light of the whole legislation and not with specific regards to
certain crudities.This position has been reiterated in Tata Cellular v. Union of
India29to the effect that it has been advised to implement judicial restraint over
legislative and administrative actions.
To take reference from the Supreme Court’s observation in State (Govt. of NCT
of Delhi) v.Prem Raj30 wherein the court held that “… where the words are clear,
there is no obscurity, there is no ambiguity and the intention of the legislature is
clearly conveyed, there is no scope for the court to innovate or to take upon itself
the task of amending or altering the statutory provisions. In that situation the
judge should not proclaim that they are playing the role of lawmaker merely for
an exhibition of judicial valour. They have to remember that there is a line,
though thin, which separates adjudication from legislation. That line should not
be crossed or erased.” This is indicative of the fact that the judiciary should
attempt to refrain from deliberating upon legislative matters which are able to
demonstrate clear purpose, need and objective behind a given enactment. The
purpose behind enactment of the PCRA arises from the concerns which have been
emphasized upon by the Law Commission of India , in its 20th Report on Electoral
Reforms31 to the effect that unaccounted and unregulated money distribution,
especially to selected political parties is resulting in an uneven playing field in the
country’s political campaigning regime.32 Without a legislative enactment in
place, that can check illegitimate money sources , donations in black money shall
continue to wreak havoc in the fair and impartial election scenario . Since, the
PCRA exhibits a clear and defined purpose, with no looming ambiguity or
obscurity in the interpretation of the text , there arises no scope or requirement of
28
R.K. Garg v. Union of India, (1981) 4 SCC 675.
29
Tata Cellular v. Union of India,AIR 1996 SC 11, ¶ 113.
30
State (Govt. of NCT of Delhi) v.Prem Raj,(2003) 7 SCC 121.
31
Law Commission of India, 20thReport on Electoral Reforms, March 2015,
http://lawcommissionofindia.nic.in/reports/Report255.pdf.
32
Election Commission of India, Guidelines on Transparency and Accountability in Party Funds and Election
Expenditure, No. 76/PPEMS/Transparency/2013, 29th August 2014,
http://eci.nic.in/eci_main1/PolPar/Transparency/Guidelines_29082014.pdf.
 judicial intervention in sound legislative policy aimed at countering corrupt
donations being made to political parties for purposes of election campaigns.

B. Judicial Review is not available in the question of a Money Bill until it

demonstrates perverseness.
The counsel puts forth the contention that the certification of a bill as Money Bill
falls within the decision making purview of the Speaker of the Parliament and is
not open to judicial scrutiny unless, it can be shown that the decision suffered
from perversity or outright unreasonableness. It is pertinent to take note of Art.
110(3) read with Art.212 of the Constitution of Bharat Nadu which renders the
status of finality to the decisions taken by the Speaker .More specifically, Art.
110(3) lays down that the decision of the Speaker shall be taken as final and
decisive when there arises a question as to whether a bill may or may not be
certified as a money bill. On similar lines, Art. 212 purports that there shall not be
raised, before any court, questions with respect to the validity of legislative
proceedings. However, the counsel is in agreement that the absolute character of
the above named Articles has been diluted to hold that any decision arising from
these are open to judicial scrutiny to the limited extent of an allegation of
perversity or illegality being attached to the decision of the Speaker .This stance
flows from the precedent laid down by the Apex Court in the decision of
KihotoHollohan v.Zachillhu&Ors.33and has been relied upon subsequently by the
Supreme Court in Justice Puttaswamy (Retd.) and Anr. v. Union of India.34 The
existence of perversity which calls for judicial review has been explained in the
foreign decision of Council of Civil Service Unions v. Minister for the Civil
Services35 and has then been reiterated by the Supreme Court in Union of India v.
G.Ganayutham.36The court stated that the yardstick to determine perversity
would be akin to the Wednesbury Test of unreasonableness that was propounded
in Associated Provincial Picture House Ltd . v.Wednesbury Corporation.37
Inferring from the court’s ratio, it was held that a decision which is prima facie
outrageous for its extreme defiance of logic and moral norms and sensibility so as

33
KihotoHollohan v.Zachillhu&Ors., AIR 1993 SC 412.
34
Justice Puttaswamy (Retd.) and Anr. v. Union of India,(2019) 1 SCC 1, ¶1146.
35
Council of Civil Service Unions v. Minister for the Civil Services,1985 (1) A.C. 374.
36
Union of India v. G.Ganayutham,A.I.R. 1997 S.C. 3387, ¶28.
37
[1948] 1 KB 223.
 to ensure that no prudent man of ordinary intelligence would have arrived at this
decision, shall be construed to be unreasonable. Thus, the Supreme Court held
that judicial review would be called in only when a decision is “… illegal or
suffered from procedural impropriety or was irrational in the sense that it was in
outrageous defiance of logic or moral standards."
However, it is contended that the scope of judicial review remains very limited
when it comes to deliberating upon the decisions taken by the Speaker of a
Legislative House. In this regard, it will pertinent to mention that the position of
law as laid down in Mohd. Saeed Siddiqui v. State of Uttar Pradesh38 and
Yogendra Kumar Jaiswal v. State of Bihar39 was that the certification of a bill as
a money bill was solely based on the decision of the Speaker and excluded the
possibility of judicial review. In light of the ratio held in KihotoHollohan
(supra),40the Supreme Court in the Puttaswamy (supra)41 judgment overruled the
above named decisions and stated that the decision of the Speaker can be
reviewed by the Judiciary on limited grounds of illegality and if found to be in
breach of constitutional provisions.
Therefore, it is humbly submitted before this Hon’ble Bench that , in facts of this
particular case, the certification of money bill by the Speaker is not open for
judicial review as the facts do not exhibit or meet any of the limited grounds of
irrationality, illegality and breaching the provisions of the Constitution of Bharat
Nadu. The PCRA is enacted in pursuance of definite legislative policy with an
aim to battle corruption on the election front. The intent behind such enactment is
to preserve the democratic set up of the country which shall be vanquished if
political donations are not brought under a regulatory mechanism. As was
observed in Kanwar Lal Gupta v. Amar Nath Chawla,42enhanced monetary
disposal at the hands of selected political parties results in the gaining of an
advantage over the other political parties which are unable to pool in money
sufficiently.Monetary donations enable political parties to engage in
incentivisation of voters through bribery, cash, liquor and results in vote-buying.
This has been described as “undisguised bullying” and undue influencing of

38
Mohd.Saeed Siddiqui v. State of Uttar Pradesh,(2014) 11 SCC 415,¶ 43.
39
Yogendra Kumar Jaiswal v. State of Bihar,(2016) 3 SCC 183.
40
Supra note 33.
41
Supra note 34.
42
Supra note 3.
 voters by muscle power, weapons, or bribery.43 In Ashok ShankarraoChavan v
MadhavraoKinhalkar,44the Supreme Court observed that due to indiscriminate
disposal of black money has become the dominant feature in election campaigns ,
thereby, affecting the conduction of fair and impartial elections . Therefore, the
PCRA which aims to bring in controlled political donations through Electoral
Bond Scheme demonstrates reasonable purpose behind its enactment. As has
already been laid out before this Hon’ble Court that there is no iota of
infringement of fundamental rights or violation of the basic structure of the
Constitution by virtue of the enactment of PCRA , there arises no consequent
question of illegality. In this backdrop, the decision of the Speaker to certify the
enactment as a Money Bill does not suffer from the vice of unreasonableness or
illegality and therefore, is not open to judicial review.

3) The consequential amendments made to different existing legislations in

pursuance of the PCRA are valid
It is humbly submitted that in pursuance to the enactment of the PCRA , different
allied legislations have been amended in order to accommodate the Electoral
Bond Scheme under their framework. The amendments mainly cater to the
insertion of newer provisions to allow for an effective implementation of the
scheme. In this backdrop, it shall suffice to contend that the amendments are valid
for the reason that [A.] they promotes cashless economy,[B.] curb corruption and
illegal flow of black money ,[C.] aid in filing of mandatory income tax returns and
[D.] foster enhanced transparency and accountability in political funding.

A) Amendment to the Representation of People Act, 1951

According to Sec.2(a) of the PCRA, an electoral bond is a bearer Banking
instrument which is to be used for funding eligible Political Parties .45Political
donation can be made to an eligible political party which has to be registered
under Sec. 29A of the RPA and must not have secured less than one percent of
the votes polled in the last general elections to the House of the People or the
Legislative Assembly.With an intention to reduce cash transactions in Bharat

43
Supra note 31, at ¶ 2.4.
44
Ashok ShankarraoChavan v MadhavraoKinhalkar,(2014) 7 SCC 99.
45
Political Contribution (Regulation) Act, 2017 § 2(a).
 Nadu and thereby shift to a cashless economy , this stride via the electoral bonds
proposed under the PCRA aims to be a stepping-stone towards the ultimate goal .
When it comes to illicit transactions, lack of traceability is crucial. There is no
paper trail to track the money back that makes cash a preferred medium for
facilitating illegal activities46. If there are no restrictions on cash transactions , then
it can be used by unscrupulous elements in amassing wealth through corrupt
practices.
In order to purchase electoral bonds, the applicant is required to submit the
application form, Pay-in-Slip, copy of Citizenship proof and KYC documents
along with the originals. Further these electoral bonds can be purchased through
Bharat Nadu Daan Bank who is the sole authorized bank by the Government for
selling Electoral Bonds. The applicant can purchase the bonds only in the national
currency. It cannot be pledged nor can it be used as a security against loans .
Moreover, it cannot be purchased on behalf of anyone nor is it eligible for trading
or can be enlisted in any stock exchange. The electoral bonds can be redeemed
only by an eligible political party by depositing it in their designated bank
account with the authorized bank within 15 days.Bharat Nadu Daan Bank which
an authorized bank by the Government will keep a record of all the transactions
and it can be used for investigation in case of any controversy. Electoral bonds
carry a unique hidden alphanumeric serial number as an inbuilt security feature
which gives rise to tracking of the bonds by enforcement agencies.
Physical cash can be anonymous and untraceable , allowing it to play a large role
in crime, including bribery, tax evasion, money, counterfeiting, corruption and
terrorist financing. However, cashless payments leave behind traceable records,
making it harder to conceal income , evade taxes and hide black market
transactions. The direct costs of printing , maintaining and transporting currency
amount to about 0.2 per cent of GDP and an increase of 5 per cent per year in
cashless transactions will save more than Rs. 500 crore annually47.

B) Amendment to the Income Tax Act, 1961

46
Chatterjee, Manifestos for health: What the Indian political parties have promised, British Medical Journal,
348 (2014), https://www.jstor.org/stable/26513825.
47
Abhay Singh Rajput & Abhimanyu Yadav, Bitcoin - Rise of the DecentralisedCurrency and its Scope in India,
4 CMET (2017).
 In the present matter, the Finance Act, 2017 has mandated through the
amendment under Sec. 13A of Income Tax Act that no donations of Rs. 2000/- or
more shall be received otherwise than by an account payee cheque drawn on a
bank or an account payee bank draft or use of electronic clearing system through
a bank account or through electoral bonds. All the payment methods mentioned
have one pivotal componentas common- traceability. It is significant to note here
that the ultimate objective is to make Bharat Nadu a cashless society . “All the
monetary transactions have to be through the banking methods and individuals
have to be accountable for each penny they possess. It is a giant step towards the
dream of making a digital India.”48
The existing provisions of Sec 13A of Income Tax Act provides that political
parties which are registered with the Election Commission are exempted from
paying income tax. To avail this exemption, the treasurer of the political parties is
required to submit a report to the Election Commission of the country , furnishing
the details of the contributions received by the political party in excess of Rs
20,000 from any person. The requisite preconditions for the exemption are , firstly,
the political party keeps and maintains books of accounts and other documents as
would enable the assessing officer to properly deduce its income therefrom;
secondly, the political party keeps a record of the name and address of the
contributor; thirdly, an accountant audits the accounts of the political party49.
One of the prominent features of electoral bonds is that the identity of the donor
will be known only to the authorised bank and otherwise be kept anonymous . A
political party is also required to file its return of income u/s 139(4B) of Income
Tax Act if its income exceeds the maximum amount not chargeable to tax ,
without considering the exemption under Sec. 13A50. Filing of tax returns obviates
the political party to mention the income that it received by way of electoral
bonds, but without elaborating upon the details that are unknown to the party
itself. Until and unless, the party files a tax return, it cannot avail the benefits
under Sec 13A51. In this manner, the Election Commission is informed about the
total income of the party. In case of inspection, the Election Commission can
48
Usha Thorat, The Dream of a Cashless Society’ The Hindu Business Line (Chennai, 13 November 2016),
www.thehindubusinessline.com/opinion/currency-ban-and-cashless-society/Art.9340990.ece.
49
As defined in the Explanation of sub-Sec . (2) of Sec. 288, Income Tax Act, Board’s Circular No . 412, dated
2.3.1985 : (1985) 152 ITR (St.) 202-3.
50
1 ACHARYA SHUKLENDRA, LAW OF INCOME TAX (4ed.2008).
51
2 CHATURVEDI &PITHISARIA, INCOME TAX LAW (6ed.2014).
 approach the authorised bank to scrutinize the contributions made via electoral
bonds.
As held by the Supreme Court,in Common Cause, A Registered Society v Union
of India52,the object of the legislative scheme is to ensure that there is fairness
and transparency in the process of fund collecting and incurring expenditure by a
political party. To be eligible for exemption, the political parties have to maintain
audited accounts and comply with the other conditions envisaged under Sec .13A.
It is pertinent to note that the books of accounts, comprising of profit and loss
account and balance sheet, will make the incomes and expenditures clear, thereby
encouraging transparency.

(chitra’s part)

C) Amendment to the Companies Act, 2013

The counsel humbly contends that political contributions may also run the risk of
being construed as bribe. The Prevention of Corruption Act, 1988 (“POCA”)
criminalizes taking of gratification by a ‘public servant’ or by any person for
inducing a ‘public servant’. Hence, under POCA, one will need to establish a
tangible nexus between the political contribution and the actions of one or more
public servants in performing an act that is held to be capricious and against
public interests, with a view to unfairly and arbitrarily benefit the contributor. In
the absence of such nexus, an allegation under POCA cannot succeed.
While Sec. 182 of the Companies Act dispensed with the requirement to disclose
the recipient political party in the P&L account, there is an independent
requirement by which political parties have to submit details of contributions
received by them at the end of every financial year to the Election
Commission.This submission is publicly available . Therefore, despite the
dispensation under Sec. 182 of the Companies Act, the amount donated will
subsequently be in the public domain in the name of Electoral Bonds.

D) Amendment to the Reserve Bank of Bharat Nadu Act, 1934

52
Common Cause, A Registered Society v. Union of India, (1996) 222 ITR 260.
 It is humbly submitted that the Preamble of The Reserve Bank of Bharat Nadu
Act, 1934 states that the Act was enacted to regulate the issue of bank notes and
the keeping of reserves with a view to securing monetary stability and ‘it is
essential to have a modern monetary policy framework to meet the challenge of
an increasingly complex economy.’ From the above words, it is equitable to
deduce that manifestly, the Act was passed to avoid the grave menace of
unaccounted money53.

Under the earlier system of political donations , massive amounts were donated
using illicit means of funding that ensured unaccounted criminal money being
contributed for funding elections. The amendment made under the RBI Act is
paramount and impending to curb this viable concern of accounted contribution
money to the political parties. As held by the Supreme Court,in Peerless General
Finance and Investment Co. Ltd. v Reserve Bank of India54,“an enabling
provision must be so construed as to sub serve the purpose for which it has been
enacted. The power to make a law with respect to any subject carries with it all
the ancillary and incidental powers to make the law effective and workable and
to prevent evasion.” In order to contain the problem of unregulated political
funding, the PCRA shall prove to be indispensable .55Through the Electoral Bond
Scheme under the PCRA, political funds can now be routed through formal
banking channels which will secure transparency56. Considering the evil that the
prior system was germinating, it cannot be said that it was not enacted for public
purpose.57

WHETHER THE DENIAL OF INFORMATION ABOUT PURCHASERS OF ELECTORAL BONDS BY BHARAT

NADU DAAN BANK IS JUSTIFIED.

4. It is humbly submitted before this Hon’ble Court that the electoral bond scheme introduced
by the Government of Bharat Nadu upholds equality between the other citizens of the nation
and the one who contributes in the political funding as equality has been accorded to each and
every citizen in the matter of franchise and the electoral roll is prepared on a secular basis
stated in the case of VV Giri v. DS Dora58.

53
JayantilalRatanchand Shah v. Reserve Bank of India &Ors., (1996) 9 SCC 650.
54
Peerless General Finance and Investment Co. Ltd. v. Reserve Bank of India, (1992) 3 SCC 343.
55
Reserve Bank of India v. Peerless General Finance and Investment Co. Ltd., (1996) 1 SCC 642.
56
Tirupati Buildings and Office Private Ltd. v. Reserve Bank of India, (2019) SCC Online Del 8990.
57
DevkumarGopaldas Aggarwal and Ors. v. Reserve Bank of India and Ors.,(1996) 9 SCC 650.
58
VV Giri v. DS Dora, AIR 1959 (SC 1318).
Article 21 of the Bharat Nadu Constitution lays down “Protection of life and personal
liberty-No person shall be deprived of his life or personal liberty except according to
procedure established by law.”59

It is humbly submitted before this Hon’ble Court that right to secrecy is an intrinsic part of a
free and fair elections, it is the central right of an elector to cast his vote without any fear of
reprisal, duress or coercion according to the Art. 21 of the Indian Constitution as held in the
case of People’s Union for Civil Liberties &Anr. v Union of India 60. Every voter has a right
to vote in a free and fair manner, the non-disclosure of the names of the voters is the
maintenance of secrecy which is must and is insisted all over the world in democracies where
direct elections are involved in order to insure that the voter casts his vote without any fear of
being victimized if there is a disclosure of his votes. Similarly, in order to maintain the
secrecy in voting electoral bonds scheme is being introduced which provides that there
should not be any disclosure of the names of the donors who contributed in political funding
the disclosure of the names of the parties will lead to political victimization, there will be
situation of quid pro quo which means that the corporations which have invested in the
political funding will take benefits with them later when they gain authority. Moreover, right
to secrecy which was introduced to avoid controversy in the election procedure will be
severely violated.

In Article 21(3) of the Universal Declaration of Human Rights and Article 25 (b) of the
International Covenant on Civil Political Rights which are read as under:

Art. 21(3):“The will of the people shall be the basis of the authority of government; this will
shall be expressed in periodic and genuine elections which shall be by universal and equal
suffrage and shall be held by secret vote or by equivalent free voting procedures.”

Art. 25:“Every citizen shall have the right and the opportunity, without any of the
distinctions mentioned in article 2 and without unreasonable restrictions:

(b) To vote and to be elected at genuine periodic elections which shall be by universal and
equal suffrage and shall be held by secret ballot, guaranteeing the free expression of the will
of the electors”

59
Article 21 of the Indian Constitution.
60
People’s Union for Civil Liberties &Anr. v. Union of India,
The above-mentioned articles also emphasize on the importance of secrecy for the conduction
of free and fair elections. Hence, electoral bond scheme upholds the right to secrecy
enunciated under art.21 of the Constitution of India.

In the case of Maneka Gandhi v Union Of India 61 the supreme court of India observed that,
Article 21 is not to be read in isolation; all violations and procedural requirement under
Article 21 are to be tested for Article 14 and Article 19 also. The Supreme Court in the
present case had adopted the widest possible interpretation of the right to life and personal
liberty, guaranteed under Article 21 of the Constitution. Article 21 is applicable even during
the time of election wherein people have the sole right of electing the best person as their
representative. No person has a right to compel anyone to elect the person other than his/her
wish. Even though voting is not a fundamental right but a ‘statutory right’, the court, in the
judgment of the case PUCL v. Union of India62, distinguishes “right to vote” and the
“freedom of voting as the species of the freedom of expression and right to equality” under
Article 19 and 14 of the Constitution.

In the present case, the petitioners have not satisfied to prove the violation of Article 14, 19
and 21, hence, it cannot be justified to question the validity of the Electoral Bond Scheme

There exist a Fiduciary relationship between the bank and its customers under section 8
(1) (e) and Article 19 (1) (a)

The word “Fiduciary” has been defined in Black's Law Dictionary63 as:

“a person holding the character of a trustee, or a character analogous to that of a

trustee, in respect to the trust and confidence involved in it and the scruples of good
faith and can do or which it requires, or a person having duty created, by his
undertaking, to act primarily for another's benefit in matters connected with such
undertaking.”

In the present case, Bharat Nadu Bank being in a fiduciary relationship with his customers i.e.
acting in confidence with the customers and has a duty to not to disclose such information to
64
any third party. The bank will be in violation with section 8 (1) (e) of the RTI if, any

61
Maneka Gandhi v Union of India, (1978) 1 SC 248.
62
Pucl v. Union of India, WP (C) 490 of 2002.
63

64
information related to electoral bonds and amount of each bond as sought by Ms. Vishrutyi
an activist if provided will be a violation of the relationship between bank and customer.

In the case of Mr. Khan Shakil Meer v. Bank of Maharashtra 65 the CIC adjudged that
“There clearly exists a fiduciary relationship between the bank and a customer. Information
received by the bank from the customer is held by the former in a fiduciary capacity and
therefore is exempt from disclosure under Section 8(1)(e) of the RTI Act. Whether the
customer is an individual or a corporate/company, a fiduciary relationship subsists between
the customer and the bank.” Also, in MRM Padma Nabha Reddy v. Vijaya Bank66 the SC
observed that bank is in a fiduciary capacity and if the information is disclosed to
the RBI and subsequently furnished to the citizens under the RTI Act, it may violate the
fiduciary relationship between the customers and the banks. The CIC made the same
observation in the case of Rakesh Kumar Singh v. Harish Chander&Othrs.67.

Thus, from the above mentioned cases it is crystal clear that the denial of information by the
bank to the activist was in line with law. 68

It is humbly submitted before this Hon’ble Court that while it is necessary to maintain and
preserve the freedom of speech and expression enunciated under art. 19(1)(a) in a democracy,
it is also necessary to provide some curbs on this freedom for the maintenance of social order
in the nation.69 In the case of RamilaMaidan Incident v. Home Secretary70 the Court held
that “No freedom can be absolute or completely restricted”.

It is humbly submitted before this Hon’ble Court that there is no violation of art. 19(1)(a) as
in the case of HanifNanjiGawada v. State of Karnataka71 it was held that any limitation on
art 19 (1)(a) would be justified where there is a strictest need of public interest requires. The
non-disclosure of the names of the donors in the political funding is a limitation which is an
essential requirement for public interest.

The limitation provided by electoral bonds for non-disclosure of the donors is reasonable and
fulfills the principles which is essential while considering the constitutionality of the statutory
provisions and imposing restrictions on the fundamental rights as held in the case of
65

66

67

68

69
MP JAIN, INDIAN CONSTITUTIONAL LAW, 1084 (8th ed., 2018)
70
(2012) 2 MLJ 32 (SC), Sahara India Real Estate Corporation Limited v. Securities & Exchange Board of
India,AIR 2012 SC 3829
71
HanifNanjiGawada v. State of Karnataka, 1997 AIHC 78 (Kant)
Papnasam Labour Union v. Madura Coats Ltd.72 In adjudging the validity of a restriction , it
is important that the courts approach it from the point of view of promotion of the social
interest which is the objective of the legislation. 73The restriction imposed by the electoral
bonds has a direct and proximate nexus with the object which the legislature seeks to achieve
and it is not in excess to the object. 74 The cardinal object of the scheme is to develop an
alternative to cash donations made to political parties in a bid to bring transparency in
political funding. Keeping in view the emergent need to ensure enhanced accountability and
to curb the menace of black money, this legislative policy aims to culminate in electoral
reforms.

It is humbly submitted that keeping in view the aforementioned precedents, it is clear that
there exists a fiduciary relationship between the bank and the customers, imposing an
obligation on the bank not to disclose the identity of the donors. Further, this is in line with
Article 19 as it is under the ambit of restrictions imposed under Article 19 (2) as public order
Thus, the non-disclosure is warranted by Section 8 (1) (e) and is constitutionally valid in the
light of the restrictions imposed under Article 19 (2).

It is humbly contended before this Hon’ble Court that the impugned legislation, being the
Political Donations (Regulation) Act, 2017 (hereinafter referred to as the PDR Act) is of the
nature of a Money Bill under Article 110 of the Bharat Nadu Constitution and has been
appropriately passed by the Union Parliament, not with an intention to bypass the scrutiny of
the Upper House as has been wrongfully alleged by the Petitioners.

In Bharat Nadu, Bills are particularly of the following types:

i. Ordinary Bill (Article 107)

ii. Financial Bill (Article 117)
iii. Money Bill (Article 110)

Article 110 (1) of the Bharat Nadu Constitution has laid down a concrete umbrella which
contains certain matters owing to which a Bill shall be deemed to be a Money Bill. However,
such a definition of Money Bill has to be construed quite strictly as has been provided under

72
PapnasamLabour Union v. Madura Coats Ltd.AIR 1955 SC 2200
73
Pathuma v. State of Kerala, AIR 1978 SC 771
74
Arunachala Nadar v. State of Madras, AIR 1959 SC 300; MRF v. Inspector, Kerala Government, AIR 1999 SC
188
Article 110 (2) which states that “A Bill shall not be deemed to be a Money Bill by reason
only that it provides for the imposition of fines or other pecuniary penalties, or for the
demand or payment of fees for licenses or fees for services rendered, or by reasons that it
provides for the imposition, abolition, remission, alteration or regulation of any tax by any
local authority or a body for local purposes”.

Article 109 of the Bharat Nadu Constitution provides for the procedure required to introduce
a Money Bill in the Union Parliament which differs from the procedure for introducing the
other Bills since it does not need to be approved by both the Houses of the Parliament. A
Money Bill cannot be introduced in Rajya Sabha, i.e., the Upper House, as per Article 109(1).
That is, the Money Bill, after it has been introduced and subsequently, passed in the
LokSabha, i.e., the Lower House, shall be sent to the Upper House, only for suggesting
recommendations to the Bill. Lok Sabha can either accept or reject all or any of the
recommendations forwarded by the Rajya Sabha. Three situations can arise out of this:

 LokSabha accepts all or any of the recommendations and thereby, the Money Bill shall be
deemed to have been passed by both the Houses of Parliament along with the
recommendations of the Upper House and duly accepted by the Lower House75.
 LokSabha does not accept any of the recommendations and thereby, the Money Bill shall
be deemed to have been passed by both the Houses wherein it has been passed by the
Lower House without incorporating the recommendations made by the Upper House76.
 However, if the recommendations have not been made within a period of 14 days from the
date of the receipt of the Bill,the Bill shall be deemed to have been passed by both the
Houses at the expiration of such a period77.

Recently, the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and
Services) Bill, 2016,was certified as a Money Bill by the Speaker of LokSabha, and was
subsequently enacted as the Aadhar Act, after rejecting the recommendations made by the
Upper House. Immediately after the enactment, a writ petition was filed before the Hon’ble
Supreme Court wherein the Speaker’s decision to treat the Aadhar Bill as a Money Bill was
challenged78. Hence, in the ensuing Aadhaar card judgement 79, one of the issues involved was
whether the Aadhaar Bill can be considered as a ‘Money Bill’ within the meaning of Article

75
Article 109(3) of Bharat Nadu Constitution
76
Article 109(4) of Bharat Nadu Constitution
77
Article 109(5) of Bharat Nadu Constitution
78
Jairam Ramesh v. Union of India, Writ Petition (Civil) 231 of 2016
79
K.S. Puttaswamy and Another v. Union of India and Another, (2019) 1 SCC 1
110 of the Constitution of India and whether the same has been appropriately certified by the
Speaker of the Lower House.At the same time, it was submitted by the Petitioners that even
though Article 110 (3) states that the decision of the Speaker of the Lower House is final as to
whether a Bill is a Money Bill or not, therefore “virtually excluding the RajyaSabha from the
legislative process and depriving the Hon’ble President of his power of return”, it does not
necessarily mean that such a decision cannot be subjected to judicial scrutiny. It was argued
that Section 7 of the Bill which is the “heart and soul” of the Bill stated that subsidies,
benefits and services shall be provided from the Consolidated Fund of India due to which the
Bill appeared to in the nature of the Money Bill, although the other provisions weren’t of the
same nature. As a result of which, the entire Bill was bound to fail, since there is no provision
for severing clauses in the Indian Constitution, unlike Section 55 of the Australian
Constitution. However, in response to the same, the legislative intent of Section 7 and object
of the Act was critically analysed. It was held by the Court that Section 7 which is the core
provision has substantial nexus with the appropriation of funds from the Consolidated Fund
of India and is directly connected with Article 110 of the Constitution.The Court was of the
opinion that the Bill was rightly introduced as Money Bill since the main provision is a part
of Money Bill under Article 110 (1) and the other provisions are only incident and therefore,
covered by Article 110 (g) of the Constitution.

Here, the PDR Act was introduced with the main object was to enable the furtherance of the
Electoral Bond Scheme, wherein an electoral bond shall act as an instrument that can be used
by individuals and corporations incorporated in Bharat Nadu to make donations to political
parties. Bonds can be purchased in denominations ranging from Rs 1,000 to Rs 1 crore from
the Bharat Nadu Daan Bank using a KYC compliant bank account,with no upper limit on the
donation amount. At the same time, the 'Bharat Nadu Daan Bank' was constituted exclusively
to handle donations to political parties by giving it the power to issue Electoral Bonds.The
Act has made the following amendments to the existing legislations:

a) Section 31 of the Reserve Bank of Bharat Nadu Act, 1934, through Section 3 of the
PDR Act;
b) b) Section 29C of the Representation of the People Act, 1951 (RoPA), through
Section 4of the PDR Act;
c) c) Section 13A of the Income Tax Act, 1961, through Section 5 of the PDR Act; and
d) d) Section 182 of the Companies Act, 2013, through Section 6 of the PDR Act.
The nature of the amendments clearly fall within the meaning of ‘Money Bill’ under Article
110 (1) of the Bharat Nadu Constitution. At the same time, the legislative intent behind
introduction of such an Act was to “cleanse corruption in political funding”.

It is thereby humbly submitted that the said Bill in the nature of a Money Bill and has been
appropriately certified by the Speaker of the Lower House of the Parliament.