Lucknow May 6: The association of democratic reforms (ADR) in its latest report about donation received by regional political parties has said that out of 52 regional parties, only 15 had submitted their donations reports to the Election Commission in the stipulated time period. The report said 10 other regional parties have delayed their submission by a maximum of 34 days to 4 days. There are 26 regional political parties who have defaulted in the submission of their donations reports to the ECI during FY 2018-19, till date, 6th May, 2020. The ADR further said the contribution report of Shiv Sena available for FY 2018-19 on the ECI website is incomplete; hence, it has not been analyzed in this report.
The report said under Section 29C (1) of the Representation of People’s Act, 1951, political parties are required to prepare a report providing details of contributions in excess of twenty thousand rupees from any person in a particular financial year to avail 100% tax exemption. However, in FY 2018-19, we see that 6 regional parties (AAP, GFP, DMK, SP, MNS and NPF) have also provided details of donations received below Rs 20,000 in their contribution reports. The total amount of donations declared by 25 regional parties analysed, including both above and below Rs 20,000, was Rs 230.45 cr, from 4046 donations. Of the parties analysed, no donations have been declared by JVM-P and AIADMK for FY 2018-19. The ADR said with regard to the total amount of donations, YSR-C leads with Rs 80.575 cr from 142 donations followed by TRS, which has declared receiving Rs 41.275 c Cash donations declared by the Regional Parties – FY 2018-19
Out of the total donations of Rs 230.45 cr declared by the regional parties, Rs 3.20 cr from 450 donations was received in cash during FY 2018-19. This formed 1.39% of the total donations to the parties. Maximum donations in cash was declared by DMK, which collected a total of Rs 2.978 cr, followed by PMK with Rs 10.60 lakhs, NPF with Rs 7.90 lakhs, RLD with Rs 3 lakhs and DMDK with Rs 1 lakh. Among all the states, donors from Tamil Nadu made the highest donations of Rs 1.58 cr in cash followed by donors from Uttar Pradesh who donated a total of Rs 3 lakhs in cash. Donations worth Rs 1.59 cr in cash did not have address details. 2 Regional Parties (NPF and DMK) have received such donations in FY 2018-19.r from 62 donations. BJD declared receiving Rs 29.317 cr that is the third highest amongst all regional parties. 65.60% or Rs 151.167 cr of the total donations received by regional parties have been received solely by top three regional parties.
Comparison of donations received by Regional Parties between FY 2017-18 and FY 2018-19
YSR-C, TRS, TDP and PMK saw the maximum percentage increase in their income from donations between FY 2017-18 and 2018-19. Donations to PMK increased by 9106%, followed by TDP for which it was 1407%, TRS for which it was 1148%, and YSR-C that saw an increase of 865%.
YSR-C, TRS, TDP, BJD and AAP declared the highest increase in the amount of donations received between FY 2017-18 and 2018-19, of Rs 72.225 cr, Rs 37.968 cr, Rs 24.442 cr, Rs 16.277 cr and Rs 6.284 cr respectively.
State-wise donations to Regional Parties:
Segregation of donations according to location was made by ADR based on the addresses provided by the parties in their donations report to the ECI. Donations declared by the regional parties contained details of donations received from 27 States/Union Territories/common capitals and 16 countries according to the declared address of donors. Only AAP declared donations from abroad.Regional parties have declared receiving the highest amount of Rs 77.215 cr from Delhi, followed by Rs 45.227 cr from Telangana and Rs 43.918 cr from Maharashtra. 3.90% or Rs 0.57 cr of the total donations above Rs 20,000 to AAP was received from abroad. A total of Rs 6.85 cr, (2.97% of total donations received by the regional parties, FY 2018-19), could not be attributed to any State/Union Territory due to incomplete or lack of information provided by the parties.
Donors from Corporates/ business sectors Vs. Individual donors: 292 donations from corporate/business sectors amounting to Rs 188.42 cr were made to the regional parties while 3414 individual donors donated Rs 39.97 cr to the parties during FY 2018-19. In case of National Parties, 1776 donations were made by corporate/business sectors amounting to Rs 876.11 cr (92.06% of total donations) while 3509 individual donors donated Rs 71.407 cr (7.50% of total donations) during FY 2018-19. With the maximum number of donations during FY 2018-19, YSR-C has declared 43 donations from corporate/business sectors amounting to Rs 70.61 cr while 78 individual donors donated Rs 9.74 cr to the party.
Disclosure of PAN details in donations: Out of 23 regional parties who had declared receiving donations, 16 parties, have declared donations of donors without their PAN details. Rs 40.42 cr or 17.54% of the total amount of donations received by regional parties do not have PAN details. It is to be noted that parties like PMK, NDPP, NPF, DMDK and JMM have not provided PAN details of even a single donor in their donations statement.
The ADR further said ECI notification dated 29th August,’14 stated that “…no tax deduction shall be allowed on the contributions made in cash by any person or company to a political party. Accordingly, the political party shall maintain the name and address of all such individuals, companies or entities making donation to it, excepting petty sums, donated by the public only during its public rallies”. This notification was applicable for donations made from FY 2014-15 onwards. 2 regional parties DMK (Rs 1.513 cr) and NPF (Rs 7.90 lakhs) have received cash donations worth a total of Rs 1.59 cr that do not have address details.
For FY 2018-19, address details for 516 donations worth Rs 6.85 cr (2.97% of total donations received by the regional parties) were not declared by parties. Out of 23 Regional Parties who had declared receiving donations, 16 parties, have declared receiving 728 donations worth Rs 40.42 cr without PAN details. For a large number of donations, regional parties have mentioned ‘Online/RTGS/Cheque no.’ as mode of contribution without providing any further information such as bank details. This makes it difficult to verify whether the information given is accurate or not. Out of a total of 4046 donations, mode of contribution for 776 donations worth Rs 56.87 cr is incomplete/undeclared. Of these, mode of payment for 59 donations worth Rs 39.775 cr received by TRS is incomplete/undeclared. Three regional parties namely TRS, SHS and BJD declared receiving donations via Electoral Bonds worth Rs 141.50 cr, Rs 60.40 cr and Rs 211.50 cr, respectively. The donations to these parties through Electoral Bonds have not been accounted for in this report, since they were accounted for in the analysis of audit reports of these parties for FY 2018-19, as per the format. Shiv Sena’s contribution report available on the ECI website for FY 2018-19 is incomplete at the time of preparation of this report.
Thus the ADR in its recommendations said The Supreme Court gave a judgment on September 13, 2013 declaring that no part of a candidate’s affidavit should be left blank. Similarly, no part of the Form 24A submitted by political parties providing details of donations above Rs 20,000 should be blank. The National and Regional Parties should, ideally, lead by example by filing complete and correct statements of donations to the ECI well in time for public scrutiny so as to encourage financial transparency. It is suggested that the ECI publicizes on its website details of the action taken (if any) against political parties that fail to provide required details (such as name and address) of individuals, companies or entities making donations in cash. Parties not adhering to the deadline fixed by the Election Commission of India should be penalized by making them liable to pay tax on 100% of their income from various sources. Incomplete contributions reports having missing or incorrect PAN/mode of payment details must be returned to the parties by the ECI, to deter them from providing incomplete information. The National and Regional political parties must provide all information on their finances under the Right to Information Act. This will go a long way in strengthening political parties, elections and democracy.