Indian corporates refuses to disclose the name of political party whom they refund stating the reason that it may lead to backlash from political parties that feel relatively less-generously funded.
Section 182 (3) of the new Companies Act says that corporates must disclose names of political parties they give money to in their profit and loss account.
Confederation of Indian Industries (CII) requested the government to change the act as it is uncomfortable for them to name the political party.
Association of Democratic Reforms on Income Tax returns and statements filed by six national political parties revealed 75% (Rs. 3,675 crore) of the their income came from the unknown sources. The political parties are not obliged the source of these unknown finds as they fall under the donations that are below 20,000.
Source of Data: ADR
To ensure that there is financial transparency and accountability on the part of the political parties, there must be a strict mechanism with respect to reporting of financial information.
In Forty counties including France, Italy, Nepal, Bhutan it is required by the law to disclose source of income to the people of the country. In countries like Sweden and Turkey political parties have a voluntary arrangement to open up their records to the people. Countries like Austria, Bhutan, Brazil, Bulgaria, France, Ghana, Greece, Hungary, Italy, Kazakhstan, Kenya and Kyrgystan have a system by law for political parties to pro-actively disclose their financial information to people.
However, in India the political parties are not obliged to submit details to the authorities and to the people.
The nexus of corporates and political parties is the main source of black money and corruptions that leads to encouragement of opaque system.
Financial transparency in the funding of political party reveals the motive of donations and also help the auditing authorities to check the biasedness in allocation in allocating the precious national resources by the ruling party.
But the question is who is going to do that? Political parties and corporates will not cut their own arm with their own sword.