Press Release: National parties collected Rs 3377.41 cr from unknown sources in FY 2019-20, which is 70.98% of the total income of the parties; BJP declared Rs 2642.63 cr as income from unknown sources, which is 3.5 times more the aggregate of income from unknown sources declared by the other 6 National Parties

47 views
Skip to first unread message

ADR India

unread,
Aug 31, 2021, 2:14:41 AM8/31/21
to national-el...@googlegroups.com, national...@googlegroups.com
Press Release

Date: 31-08-2021 

Analysis of Sources of Funding of National Political Parties of India, FY 2019-20


Political Parties play a key role in democracies as they contest elections, form governments, formulate policies and are responsible for providing governance and improving the lives of the common man. Political parties need access to money in order to reach out to the electorate, explain their goals/policies and receive inputs from people. But where do they collect their funds from?

An analysis of their Income Tax Returns and donations statements filed with the Election Commission of India (ECI) shows that the sources remain largely unknown. At present, political parties are not required to reveal the name of individuals or organizations giving less than Rs. 20,000 nor those who donated via Electoral Bonds. As a result, more than 70% of the funds cannot be traced and are from ‘unknown’ sources. While the National Political Parties were brought under the RTI Act by the CIC ruling in June 2013, they have still not complied with the decision. Full transparency is, unfortunately, not possible under the current laws, and it is only the RTI that can keep citizens informed.
 
The reports in both English and Hindi are attached herewith. To access them on our website, please visit: https://adrindia.org/content/analysis-sources-funding-national-parties-fy-2019-20

Observations of ADR
  • Between FY 2004-05 and 2019-20, the National Parties have collected Rs 14,651.53 cr from unknown sources (links to reports given in ‘References’).

  • During FY 2019-20, BJP declared Rs 2642.63 cr as income from unknown sources which is 78.24% of the total income of National Parties from unknown sources (Rs 3377.41 cr). This income of BJP is 3.5 times more the aggregate of income from unknown sources declared by the other 6 National Parties (Rs 734.78 cr).      
       
  • INC declared Rs 526 cr as income from unknown sources which is 15.57% of the total income of National Parties from unknown sources.

  • Out of Rs 3377.41 cr as income from unknown sources, share of income from Electoral Bonds was Rs 2993.826 cr or 88.643%.

  • Combined income of INC and NCP from sale of coupons between FY 2004-05 and 2019-20 stands at Rs 4096.725 cr.

  • According to the donations reports (containing details of donations above Rs 20,000) of FY 2019-20, Rs 3.18 lakhs was received in cash by the National Parties. 

Income of Political Parties from Known, Other known and unknown sources
  • For this report, known sources have been defined as donations above Rs 20,000, whose donor details are available through contributions reports as submitted by National parties to the ECI.

  • The unknown sources are income declared in the IT returns but without giving source of income for donations below Rs. 20,000. Such unknown sources include ‘donations via Electoral Bonds’, ‘sale of coupons’, ‘relief fund’, ‘miscellaneous income’, ‘voluntary contributions’, ‘contribution from meetings/morchas’ etc. The details of donors of such voluntary contributions are not available in the public domain.

  • Other known sources of income include sale of moveable & immoveable assets, old newspapers, membership fees, delegate fee, bank interest, sale of publications and levy whose details would be available in the books of accounts maintained by political parties.

  • For this analysis, 7 National parties were considered – BJP, INC, AITC, CPM, NCP, BSP and CPI. However, BSP declared that it did not receive any funds from voluntary contributions (above or below Rs 20,000)/Sale of Coupons/Electoral Bonds or Unknown Sources of income. The audit report of NPEP is not available on the website of ECI at the time of preparation of this report. Hence, the sources of funding data of the party have not been analysed.

  • Total income of 7 National political parties in FY 2019-20: Rs 4758.206 cr.

  • Total income of political parties from known donors (details of donors as available from contribution report submitted by parties to Election Commission and analysed by ADR here): Rs 1013.805 cr, which is 21.31% of the total income of the parties.

  • Total income of political parties from other known sources (e.g. sale of assets, membership fees, bank interest, sale of publications, party levy etc.): Rs 366.991 cr, or 7.71% of the total income.

  • Total income of political parties from unknown sources (income specified in the IT Returns whose sources are unknown): Rs 3377.41 cr, which is 70.98% of the total income of the parties.

  • Out of Rs 3377.41 cr as income from unknown sources, share of income from Electoral Bonds: Rs 2993.826 cr or 88.643%.


image.png

                          *Other known income includes: sale of moveable & immoveable assets, old newspapers, membership fees, delegate fee, bank interest, sale of publications and levy

**Details of income from unknown sources is given in Annexure – 1; Party-wise sources of income are given in Annexure – 2



Income from unknown sources


  • Out of total income of Rs 3377.41 cr of 7 National Parties from unknown sources, 88.643 % or Rs 2993.826 cr came from Electoral Bonds.

  • Income from sale of coupons declared by INC, NCP & CPM formed 5.747% (Rs 194.095 cr) of income from unknown sources while Donations from Voluntary Contributions (below Rs 20,000) formed 5.255% (Rs 177.483 cr) in income from unknown sources of the 7 National Parties.

image.png

image.png

Recommendations of ADR
  • Since a very large percentage of the income of political parties cannot be traced to the original donor, full details of all donors should be made available for public scrutiny under the RTI. Some countries where this is done include Bhutan, Nepal, Germany, France, Italy, Brazil, Bulgaria, the US and Japan. In none of these countries it is possible for more than 70% of the source of funds to be unknown, but at present it is so in India.

  • Mode of payment of all donations (above and below Rs 20,000), income from sale of coupons, membership fees, etc.  should be declared by the parties in the ‘Schedules’ of their audit reports, submitted annually to the Income Tax department and the ECI.

  • The ECI has recommended that tax exemption be awarded only to those political parties which contest and win seats in Lok Sabha/ Assembly elections. The Commission has also recommended that details of all donors who donate above Rs 2,000 be declared in public domain. ADR supports ECI for its strong stand to enforce reforms in funding of political parties and hopes that these reforms are proactively taken up by the Government for implementation.

  • Scrutiny of financial documents submitted by the political parties should be conducted annually by a body approved by CAG and ECI so as to enhance transparency and accountability of political parties with respect to their funding.

  • The National and Regional political parties must provide all information under the Right to Information Act. This will only strengthen political parties, elections and democracy. However, RTI or not, political parties should voluntarily account for every rupee that they get or spend.

Contact Details

 

Media and Journalist Helpline

+91 80103 94248

Email: a...@adrindia.org

 

Maj. Gen Anil Verma (Retd.)

Head- ADR & NEW

+91 11 4165 4200

+91 88264 79910

anil...@adrindia.org

 

Prof Jagdeep Chhokar

IIM Ahmedabad (Retd.)

Founder - ADR & NEW

+91 99996 20944

jchh...@gmail.com

 

Prof Trilochan Sastry

IIM Bangalore

Founder Member- ADR & NEW

+91 94483 53285

tsa...@gmail.com




--
Association for Democratic Reforms

T-95, C.L. House, 2nd Floor,
(Near Gulmohar Commercial Complex)
Gautam Nagar
New Delhi-110 049

Mob No: +91 8010394248 
Fax No.: 011 4609 4248


Listen to Our Podcast on      
Support Us By Donating Here

Websites:   adrindia.org

    
English_Analysis of sources of funding of National Parties - FY 2019-20.pdf
Hindi- Analysis of sources of funding of National Parties - FY 2019-20.pdf
Reply all
Reply to author
Forward
0 new messages