As the Lok Sabha took up the Finance Bill for consideration, the Opposition also questioned the government move to amend the Reserve Bank of India Act to enable the issuance of electoral bonds.
The government on Tuesday introduced as many as 40 amendments to the Finance Bill — including lowering the limit of cash transaction to R2 lakh from the Budget proposal of R3 lakh and tweaking the RBI Act to pave the way for issuance of electoral bonds, keeping the identity of the donor secret —inviting strong criticism from the Opposition that termed the move “unprecedented”.
As the Lok Sabha took up the Finance Bill for consideration, the Opposition also questioned the government move to amend the Reserve Bank of India Act to enable the issuance of electoral bonds, as proposed in the Budget for 2017-18, arguing such an amendment can’t be a part of the Finance Bill. For this, the opposition argued, the government should have brought an amendment to the Representation of the People Act or introduced a new Bill on transparency in electoral funding.
Defending the government move, finance minister Arun Jaitley said: “How are the electoral bonds to be issued? Electoral bonds will not be issued by individuals. RBI will authorise a particular bank to issue electoral bonds. The buyer will buy by cheque and the money will go to the political party in a pre-declared account. RBI may authorise or notify a particular bank.”
Jaitley said the Representation of the People Act currently provides for revealing the identity of people making donations above R20,000. The amendment would provide that if money comes by way of electoral bonds, the identity will not be disclosed.
The Budget has proposed income tax incentive for money paid by cheque, or small donation of R2,000, or mass collection by digital medium and electoral bond issued under I-T Act.
The government also moved certain amendments to laws, including the Companies Act, Employees Provident Fund, Smuggling and Foreign Exchange Act, TRAI Act and Information Technology Act, were moved with the objective of making the functioning of tribunals more efficient by merging the smaller ones and reducing their numbers from the current 40 to 12.
Opposition parties raised objections to the introduction of the amendments to 40 Acts, saying it was being done in the form of a “back-door entry”. However, Speaker Sumitra Mahajan overruled the objections, saying the ‘incidental provisions’ involved in the amendments constitute a Money Bill and, therefore, can be considered as part of the Finance Bill.
For his part, Jaitley invoked first Lok Sabha Speaker G V Mavalankar and said if a substantial portion of a Bill deals with imposition or abolition of tax, then even if it has other incidental provisions, it still can be introduced as a Money Bill. He also defended the decision to introduce amendments to the Post Office Act, the Oil Industry Development Act and the Research and Development cess as part of the Finance Bill, saying they come under the purview of Article 110 and conform to established procedures.
However, Congress’ Deepender Hooda said the government should have brought a separate bill on transparency in electoral funding for this purpose, as amendment to the RBI Act was ‘consequential’ and not ‘incidental’.