SC scraps electoral bond scheme, terms it 'unconstitutional'

Supreme Court on Thursday scrapped a seven-year-old election funding system that allows individuals and companies to donate money to political parties anonymously and without any limits.

The decision is seen as a setback for Bharatiya Janata Party (BJP), which has been the largest beneficiary of the system it introduced in 2017. The system, called 'Electoral Bonds', was challenged by opposition members and a civil society group on grounds that it hindered the public's right to know who had given money to political parties.

Under the system, a person or company can buy these bonds from the state-run State Bank of India and donate them to a political party of their choice.

A five-judge bench headed by Chief Justice DY Chandrachud said that the system is "unconstitutional". The court directed SBI to not issue any more of these bonds.