Daily Current Affairs : 15th and 16th February 2024

Topics Covered

  1. Temporary Suspension of Telecom Services (Public Emergency or Public Safety) Rules, 2017 of the Indian Telegraph Act, 1885
  2. Electoral Bonds
  3. Facts for Prelims

1 . Temporary Suspension of Telecom Services (Public Emergency or Public Safety) Rules, 2017 of the Indian Telegraph Act, 1885

Context : In a departure from norms, the Union Home Ministry issued two orders, on February 10 and February 12, under the Temporary Suspension of Telecom Services (Public Emergency or Public Safety) Rules, 2017 of the Indian Telegraph Act, 1885.

What do the Rules say?

  • The Rules, issued under the Indian Telegraph Act, 1885, stipulate that only the Home Secretary of the Union or a state can pass an order, and that the order must include the reasons for the decision.
  • The order should be forwarded to a review committee the day after it is issued, and must be reviewed by the committee within five days to assess its compliance with Section 5(2) of The Telegraph Act, under which the government has the power to block the transmission of messages during a public emergency or for public safety.
  • In the case of the central government, the review committee comprises the Cabinet Secretary and the Secretaries of the Departments of Legal Affairs and Telecommunications.
  • In the case of states, the committee comprises the Chief Secretary, Secretary, Law or Legal Remembrancer In-Charge, Legal Affairs, and a Secretary to the state government (other than the Home Secretary).
  • In “unavoidable circumstances”, the order can be issued by an officer of the rank of Joint Secretary or above, authorised by the Centre or the state Home Secretary.
  • Telecom service providers must designate nodal officers to handle such requests.

What laws governed this area before the 2017 Rules were notified?

  • Internet shutdowns were ordered under Section 144 of the Code of Criminal Procedure, which gives District Magistrates broad powers during dangerous situations. Even after 2017, many local shutdowns are issued under this law.
  • Section 69(A) of the IT (Amendment) Act, 2008 gives the government powers to block particular websites, not the Internet as a whole.
  • The Centre has never ordered a nationwide Internet shutdown. Still, India tops the list of Internet shutdowns globally.

2 . Electoral Bond

Context: Supreme Court declares electoral bonds scheme unconstitutional.  

About the news 

  • In a landmark unanimous judgment, the Supreme Court struck down as “unconstitutional and manifestly arbitrary” the electoral bonds scheme, which provides blanket anonymity to political donors, as well as critical legal amendments allowing rich corporations to make unlimited political donations. 
  • The court held that the Union government’s scheme, and preceding amendments made to the Representation of the People Act, the Companies Act, and the Income Tax Act, violated the voters’ right to information about political funding under Article 19(1)(a) of the Constitution. 
  • It said the absolute non-disclosure of the source of political funding through electoral bonds promoted corruption, and a culture of quid pro quo with the ruling party to introduce a policy change or for bagging a license. The scheme and the amendments authorised “unrestrained influence of corporates in the electoral process.”  

Why did the Supreme Court strike down the Electoral Bonds Scheme? 

  • It violates voters’ right to information: the court unanimously held that voters have a right to information about political parties and their sources of funding. It highlighted the “deep association” between money and politics, and how economic inequality contributes to political inequality by increasing the possibility of quid pro quo arrangements for those with the ability to contribute larger amounts to political parties. These arrangements, the court said, could result in favourable policy changes and government licenses which the voters have a right to know about. This information is concealed under EBS. 
  • Restrictions are disproportionate to the stated goal of curbing circulation of black money: The court presented Section 29C of the Representation of People Act, 1951, as a viable, less restrictive alternative. The court noted that this section, before it was amended by the Finance Act, 2017, required all political parties to declare any contributions higher than Rs. 20,000. The amendment to the section, which exempted political parties from making declarations for donations received through electoral bonds, was struck down by the court. 
  • Right to donor privacy is not absolute: The SC held that the right to privacy of political affiliation only extends to contributions that are made as genuine forms of public support, not contributions that are made to influence the policies of a political party. Observing that absolute anonymity lies at the heart of the EBS, the court saw fit to strike down the entire scheme. 
  • Unlimited political contributions by companies is unconstitutional: The court drew a stark distinction between contributions made by companies and those made by individuals. It stated that contributions from companies were purely business transactions made with the intent of securing benefits in return. The court also highlighted the fact that companies have a greater ability to influence politics through contributions, stating “permitting unlimited corporate contributions authorises unrestrained influence of companies in the electoral process”. This would violate the right to free and fair elections.  

Test of Proportionality applied in the case

What is the proportionality test? How does the Court decide whether the state action is proportional? 

  • A law passed by Parliament cannot interfere with Part-III of the Constitution that lists out the inviolable fundamental rights. The only interference with Article 19(1) — which guarantees the fundamental right to free speech — permissible is to the extent that the “reasonable restrictions” listed in Article 19(2) are not flouted. The test to decide whether an action is a reasonable restriction is the proportionality test. 
  • In the 2018 SC ruling that upheld the Aadhaar Act, Justice Chandrachud in his dissenting opinion said that the proportionality test is “the dominant best practice judicial standard for resolving disputes that involve either a conflict between two rights claims or between a right and a legitimate government interest.” The test is deemed necessary to guard against arbitrary action, so that the state cannot extinguish the right entirely even in pursuance of a legitimate state interest. For example, the right to life cannot be taken away to ensure law and order. 
  • The test was formally laid down as the best practice in the 2017 seven-judge Bench Puttaswamy ruling, which recognised the right to privacy as a fundamental right. Justice Sanjay Kishan Kaul in his concurring opinion stated the state action to be upheld must show: (i) The action is sanctioned by law; (ii) The proposed action must be necessary in a democratic society for a legitimate aim; (iii) The extent of such interference must be proportionate to the need for such interference; and (iv) There must be procedural guarantees against abuse of such interference.” 

The govt’s argument 

  • In the electoral bonds case, the government had argued that curbing black money and protecting donor anonymity are both legitimate aims for the state. While tackling black money is fairly non-contentious, the government argued that donor anonymity is also a legitimate state interest since it seeks to give effect to a fundamental right — the right to privacy of the donor. 
  • On the extent of interference with the voter’s right to know, the government argued that the right to information only operates against information in the possession or in the knowledge of the state. It cannot operate for seeking information not in the knowledge or possession of the state, Solicitor General argued. 
  • Finally, on the issue of safeguards, the SG said that on a court order, all the details can be furnished for a criminal investigation. 

How the test was used? 

  • Justice Khanna, applying the proportionality test in his separate opinion, said that donor anonymity cannot be a legitimate state aim. He also held that voters’ right to know supersedes anonymity in political party funding. 
  • CJI Chandrachud, however, applied the “double proportionality” test. Since the case involves balancing facets of two competing fundamental rights — the right to information and the right to privacy, the proportionality test would not be enough. 
  • According to him, the proportionality test is for when a right is directly tested against state action, but for a “balancing” of rights, the court needs to go further. Essentially, the court will have to examine the matter from the perspective of both rights and decide if the state has adopted the “least restrictive” methods to realise both rights. Additionally, whether the measure has a disproportionate impact on any one of the two rights also has to be looked at. 
  • The CJI in his opinion pointed out that there are less intrusive methods, such as the electoral trusts scheme, to achieve the objective of curbing black money and protecting donor anonymity. 

Amendments Struck down by the Verdict :  

  • The Representation of the People Act, 1951: Section 29C of the Act requires political parties to prepare a report detailing the donations received by them in a financial year. Parties are required to declare all contributions higher than Rs 20,000 in this report, and specify whether they were received from individual persons or from companies. 

WHAT FINANCE ACT, 2017 DID: The Finance Act, 2017, amended the RP Act to include an exception to Section 29C. It said that the requirement to declare all donations in excess of Rs 20,000 would not apply to donations received through Electoral Bonds. 

WHAT THE SC SAID: The Supreme Court struck down the amendment, and observed that the original requirement to disclose contributions of more than Rs 20,000 did an effective job of balancing voters’ right to information with the right to privacy of donors, as donations below this threshold were far less likely to influence political decisions. 

  • The Companies Act, 2013: A number of changes were made to Section 182 of the Act, which details the prohibitions and restrictions a company must abide by when giving political contributions. Prior to the amendment, Section 182(1) placed a cap on the amount of money a company could donate in a single financial year, limiting it to 7.5% of the company’s average net profits during the previous three financial years.Section 182(3) required a company to disclose any amount contributed to any political party along with the particulars of the amount donated and the name of the receiving party.  
    WHAT FINANCE ACT, 2017 DID: This section was amended to remove the cap on the amount of money a company could donate to a political party. Also, only the total amount contributed had to be disclosed — and the company would no longer be required to declare which political party it had sent a donation to, nor the specific amount. 

WHAT THE SC SAID: The court struck down this amendment. Chief Justice of India (CJI) D Y Chandrachud observed that “permitting unlimited corporate contributions authorises unrestrained influence of companies in the electoral process”. The court held that this violated the right to free and fair elections, and restored the original provision which is meant to curb corruption in electoral financing. 

  • The Income-tax Act, 1961: Section 13A(b) of The Income-tax Act says that a political party shall not include voluntary contributions as part of its total income, but it is required to maintain a record of all contributions received that are above Rs 20,000. This record must include the name and address of the person who has made the donation.  

WHAT FINANCE ACT, 2017 DID: The Act amended this section to include the words “other than contribution by way of Electoral Bond”.Also, a new Section 13A(d) was added, which required that all donations exceeding Rs 2,000 must be given through certain methods, which included Electoral Bonds. 

WHAT THE SC SAID: The court held that exempting political parties from maintaining a record of donations received through Electoral Bonds would violate the right to information of voters under Article 19(1)(a) of the Constitution. 

Objections by RBI

  • RBI’s objections: There were multiple rounds of discussions between the RBI and the Finance Ministry on electoral bonds. In 2017, the RBI first objected to the proposal to enable other banks to issue electoral bearer bonds for donations to political parties before the Finance Act 2017 was enacted.  
  • The RBI had three main arguments: Such an amendment would enable multiple non-sovereign entities to issue bearer instruments. The RBI had argued that the proposal  to allow any other bank to issue EBs “militated against RBI’s sole authority for issuing bearer instruments which has the potential of becoming currency”. RBI was of the opinion that if such EBs are issued in sizable quantities, they can undermine the faith in banknotes issued by the Central Bank. 
  • The RBI also noted that while the identity of the person or entity purchasing the bearer bond will be known because of the Know Your Customer requirement, the identities of the intervening persons/entities will not be known. This would impact the principles of the Prevention of Money Laundering Act 2002. 
  • The RBI was of the opinion that the intention of introducing electoral bonds , that the electoral contributions be paid out of tax-paid money , can be accomplished by cheque, demand draft, and electronic and digital payments. 
  • As the discussions continued, the RBI persisted with its view that it should be the only authority to issue such bonds. In 2017, when it was presented with the draft scheme, the RBI stated that permitting a commercial bank to issue bonds would “have an adverse impact on public perception about the scheme, as also the credibility of India’s financial system in general and the central bank in particular.”  
  • It reiterated the possibility of shell companies misusing bearer bonds for money laundering transactions. 
  • It also warned that the issuance of electoral bonds in the scrip form could also expose it to the risk of forgery and cross-border counterfeiting.  

Objections by ECI

  • The Election Commission’s main objection was that EBs would have a serious impact on transparency of political finance/funding of political parties. 
  • In 2017, the ECI wrote to the Ministry of Law and Justice about the amendments to the IT Act, the Representation of the People Act, and Companies Act introduced by the Finance Act 2017. 
  • It stated that the Amendment which has been made to the Representation of the People Act 1951 “is a retrograde step as far as transparency of donations is concerned and this proviso needs to be withdrawn”. 
  • Further, referring to the deletion of the provision in the Companies Act requiring companies to disclose particulars of the amount contributed to specific political parties, the ECI had recommended that “companies contributing to political parties must declare party-wise contributions in the profit and loss account to maintain transparency in the financial funding of political parties.” 
  • The ECI had also recommended that “the earlier provision prescribing a cap on corporate funding be reintroduced because unlimited corporate funding would increase the use of black money for political funding through shell companies”. 

Rules around the world to regulate Political Funding

  • Regulation of donations: Some individuals or organisations, for instance, foreign citizens or companies, may be banned from making donations. There may also be donation limits, aimed at ensuring that a party is not captured by a few large donors — whether individuals, corporations, or civil society organisations. Some jurisdictions rely on contribution limits for regulating the influence of money in politics. US federal law imposes different contribution limits on different types of donors. Some other countries, such as the UK, do not impose contribution limits, but instead, rely on expenditure limits. 
  • Limits on expenditure: Expenditure limits safeguard politics from a financial arms race. They relieve parties from the pressure of competing for money even before they start to compete for votes. Therefore, some jurisdictions impose an expenditure limit on political parties. For example, in the UK, political parties are not allowed to spend more than £30,000 (about Rs 30 lakh) per seat. In the US, the Supreme Court’s expansive interpretation of the First Amendment (freedom of expression) has come in the way of legislative attempts at imposing expenditure limits. 
  • Public financing of elections: Many countries provide public funding of parties. The most commonly used method is to set predetermined criteria. For instance, in Germany, parties receive public funds on the basis of their importance within the political system. Generally, this is measured on the basis of the votes they received in past elections, membership fees, and the donations received from private sources. German “political party foundations” receive special state funding dedicated to their work as party-affiliated policy think tanks. A relatively recent experiment in public funding is that of “democracy vouchers”, which is used in local elections in Seattle, US. The government distributes a certain number of vouchers — each of which is worth a certain amount — to eligible voters. Voters can use these vouchers to donate to the candidate of their choice. The voucher is publicly funded, but the decision to allocate the money is the individual voter’s. Put simply, voters get to “vote” with their money before they cast their ballot. However, some recent studies have pointed out that this system may promote more extremist candidates. More generally, one of the problems with public funding is that unless a decision is taken to ban private funding altogether (which is difficult in India), public funding only tops up party funds — it does not address the challenge of regulating private money 
  • Disclosure requirements: This aspect of the regulation of private money in politics formed the crux of the Electoral Bonds case. Disclosure requirements do not outrightly prevent parties or donors from receiving or making donations. Instead, disclosures nudge voters against electing politicians who have used or are likely to use their public office for quid pro quo arrangements. As such, disclosures may discourage parties from using public office to benefit their donors.Disclosure as regulation rests on an assumption that the information supply and public scrutiny may influence politicians’ decisions and the electorate’s votes. However, mandatory disclosure of donations to parties is not always desirable. At times, donor anonymity serves a useful purpose of protecting donors. For instance, donors may face the fear of retribution or extortion by the parties in power. The threat of retaliation may, in turn, deter donors from donating money to parties of their liking. Many jurisdictions have struggled with striking an appropriate balance between the two legitimate concerns — transparency and anonymity. This issue was addressed by the Supreme Court in its judgment. 
  • The Chilean experiment: An experiment in Chile sought to ensure “complete anonymity” of party funding. Under the Chilean system of “reserved contributions”, donors could transfer to the Chilean Electoral Service the money they wished to donate to parties, and the Electoral Service would then forward the sum to the party without revealing the donor’s identity. If the complete anonymity system worked perfectly, the political party would not be able to ascertain the sum donated by any specific donor — and would find it extremely difficult to strike quid pro quo arrangements. However, it would be in the interest of donors (who want government patronage) and parties (who need money) to informally coordinate in advance to ascertain the sums donated by those donors. Indeed, as various scandals revealed in 2014-15, Chilean politicians and donors had coordinated with each other to effectively erode the system of complete anonymity. 
  • Balancing transparency, anonymity: The most prominent response, then, is to balance legitimate public interests in transparency and anonymity. Many jurisdictions strike this balance by allowing anonymity for small donors, while requiring disclosures of large donations. In the UK, a party needs to report donations received from a single source amounting to a total of more than £7,500 in a calendar year. The analogous limit in Germany is €10,000. The argument in favour of this approach is: small donors are likely to be the least influential in the government and most vulnerable to partisan victimisation, while large donors are more likely to strike quid pro quo arrangements with parties. 

3 . Facts for Prelims

BAPS Mandir

  • The temple has been built by the Bochasanwasi Akshar Purushottam Swaminarayan Sanstha (BAPS), a denomination of the Swaminarayan Sampradaya, a Vaishnav sect of Hinduism.
  • BAPS has a network of around 1,550 temples across the world, including the Akshardham temples in New Delhi and Gandhinagar, and Swaminarayan temples in London, Houston, Chicago, Atlanta, Toronto, Los Angeles, and Nairobi.
  • It also runs 3,850 centres and 17,000 weekly assemblies globally.
  • The Abu Dhabi temple is a traditional stone Hindu temple with seven shikhars. Built in the traditional Nagar style, the temple’s front panel depicts universal values, stories of harmony from different cultures, Hindu spiritual leaders and avatars.
  • The temple has two central domes, Dome of Harmony and Dome of Peace, emphasising human coexistence through the carvings of earth, water, fire, air, and plants.
  • A Wall of Harmony, one of the largest 3D-printed walls in the UAE, features a video showcasing key milestones of the temple’s construction. The word ‘harmony’ has been written in 30 different ancient and modern languages.
  • The seven shikhars (spires) are representative of the seven Emirates of the UAE.
  • The temple was judged the Best Mechanical Project of the Year 2019 at the MEP Middle East Awards, and the Best Interior Design Concept of the Year 2020.

Technical Recession

  • A technical recession is a period of two consecutive quarters of negative growth in a country’s real GDP. It’s a more specific term than a recession, which is a period of weak or negative growth in real GDP and a significant rise in unemployment

 Global Pulses Conference

  • The Global Pulse Confederation (GPC, formerly known as CICILS IPTIC) represents all segments of the pulse industry value chain from growers, researchers, logistics suppliers, traders, exporters and importers to government bodies, multilateral organizations, processors, canners and consumers. Its membership includes 24 national associations and over 500 private sector members. GPC is based in Dubai and licensed by the Dubai Multi Commodity Centre (DMCC).

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