RTIs net – Political Parties IN, Sports Bodies still OUT

When the entire country is struggling with corruptions, scams, bettings, and maoists, the Central Information Commission (CIC) passed a land-mark judgement today which brings all Political Parties under the ambit of Right To Information (RTI) Act.  Since this is a land mark judgement and has many implications in future, let us analyse the facts and figures of the entire episode.

Complainants:

The case was filed by  Shri Subhash Chandra Agrawal (Shri S.C.Agrawal) and Shri Anil Bairwal separately a couple of years back. Since both the complaints are common with issues relating to the disclosure of the accounts and funding of Political Parties, CIC decided to  dispose both the complaints through a common order.

Respondents:

Six National political parties namely, Indian National Congress (INC)/ All India Congress Committee (AICC), Bhartiya Janata Party(BJP), Communist Party of India (Marxist) (CPM), Communist Party of India(CPI), Nationalist Congress Party (NCP) and Bahujan Samaj Party (BSP).

Major Arguments by Political Parties:

Most of  the Political Parties maintained the fact that they do not come under the purview of RTI Act. Further, they (AICC and BJP in particular) also maintained the fact they are not Public Authorities, and, therefore are not obliged to provide any information under RTI. NCP in particular argued that it is an NGO (Non-Govt. Organization) and does not have fund and staff to reveal the information under RTI Act. Contrary to the above, CPI provided certain information to RTI applications (agreed to the fact that CPI is a Public Authority under 2(h)(d)(ii) “non-government organizations”, whereas no other political parties chose to respond to the RTI applications /queries. However, during the course of the argument, BSP also maintained the fact that Political Parties are not Public Authorities.

Most of the Political Parties argued that, the limited finance in terms of free air-time in Radio and TV, lands/plots allocated either free-of-cost or on rent, free electoral rolls provided to political parties during election, tax-exemption under Section 13 of Income Tax Act, are usual democratic practices in many democracies and do not constitute them as Public Authorities.

Major Arguments by Complainants:

1. The Political Parties have been given statutory status under Section 29A of the Representation of the People Act, 1951. Under Section 29A (5) of the Representation of People Act, 1951, the Political Parties are required to bear true faith and allegiance to the Constitution of India as by law established.

2. The Political Parties are substantially financed by the ‘appropriate Government’ in multiple ways and are exempt from Income Tax.

3. All the Political Parties have been claiming tax exemption under section 13A of the Income Tax Act, which amounts to indirect financing of the Political Parties in terms of Section 2(h)(d)(i) of the RTI Act. Further, since under section 80 GGB of the Income Tax Act, the contributions made by an individual or Company to a Political Party is deductible from the total income of the assesee. This provision is exclusively applicable to the Political Parties and is suggestive of indirect financing of the Political Parties by the State.

4. State has been indirectly financing various Political Parties by way of free air  time on All India Radio. State is also spending huge amounts on the Political Parties in the matter of free air time on Doordarshan.

5. Under Rules 11 and 12 of the Registration of Electors Rules, 1960, two copies of the Electoral Rolls are supplied to the recognized Political Parties, free of cost. This is another instance of indirect financing of the Political Parties by the State.

6. The Central Government and the State Governments have allotted huge plots of land/buildings/other accommodation in prime locations to all Political Parties all over the country either, free of cost, or on hugely concessional rates. This also amounts to indirect financing of the Political Parties.

7. It was further argued that the Political Parties must be accountable in the light of Reforms of Electoral Laws (1999) – “[…] A political party which does not respect democratic principles in its internal working cannot be expected to respect those principles in the governance of the country. It cannot be dictatorship internally and democratic in its functioning outside […]”. In addition “[…] Given that Political Parties influence the exercise of political power, transparency in their organization, functions and, more particularly, their means of funding is a democratic imperative, and, therefore, is in public interest […]”.

Bench:

Since the matter was complex a full bench comprising of Shri Satyananda Mishra, Chief Information Commissioner, Smt. Annapurna Dixit, Information Commissioner and Shri M.L. Sharma, Information Commissioner was constituted on 31st July, 2012.

Observations:

While pronouncing the judgement, the bench observed that-

1. The Political Parties constitute one of the most important institutions in a constitutional democracy.

2. The Political Parties have been given in our country such enormous powers and benefits, through both constitutional and statutory arrangements so that they can fulfill their just roles in representing their constituents.

3. The Land & Development Office of the Ministry of Urban Development has allotted large tracts of land in Delhi to various Political Parties either free of cost or at concessional rates;  that the Directorate of Estates, Ministry of Urban Development, has allotted accommodation in Delhi to various Political Parties on rental basis at concessional rates; that Political Parties have been claiming and granted total tax exemption under section 13A of the Income Tax Act for all their income; that the State has been indirectly financing Political Parties by way of free air time on All India Radio and Doordarshan of India during the elections; that recognized Political Parties are issued copies of electoral rolls by the Election Commission, free of cost, at the time of elections.

4. Section 2(h) of the RTI Act defines ‘public authority’ – “public authority” means any authority or body or institution of self-Government established or constituted, (a) by or under the Constitution; (b) by any other law made by Parliament; (c) by any other law made by State Legislature; (d) by notification issued or made by the appropriate Government, and includes any – (i) body owned, controlled or substantially financed; (ii) non-Government Organisation substantially financed, directly or indirectly by funds provided by the appropriate Government;”

5. W.r.t. the above observations, it is to be noted that (a), (b), (c) and (d) are not directly applicable to Political Parties. […] However, it is pertinent to remember that the Political Parties have been brought into existence first as Political Parties and then as national level Political Parties by the Election Commission of India thereby entitling them to a host of benefits, the principal among them being the right to accept contribution from both individual citizens and private companies and also to get complete income tax exemption on all their incomes. The other important benefit that accrues to these Political Parties on account of their recognition by the Election Commission of India as national level Political Parties is the common symbol on which their candidates can contest elections. Thus, if not strictly within the letter of this particular provision (d), but at least, in spirit, these Political Parties can be said to have been constituted by their registration by the Election Commission of India, a fact akin to the establishment or constitution of a body or institution by an appropriate government.

6. The bench further observed that the Political Parties are substantially financed by the Central Government and State Government in multiple ways; land is being provided at hugely concessional rates. The bench in its further considered opinion stated that, “amounts to indirect financing and when added to the income tax exemption enjoyed by these Political Parties, it would amount to substantial financing”.

7. Since these Political Parties have not paid any income tax, the exact quantum of money that the Central Government has forgone in the process has not been worked out specifically. However, since the level of income of all these Political Parties would place them in the highest slab of income tax, at least 30% of their total income would have been collected as income tax but for the total exemption given to them by law. Thirty per cent of their income which these Political parties would have otherwise paid by way of income tax has been given up in their favour by the Central Government. No one can dispute that this is substantial financing, though indirectly.

8. The bench has the opinion that “the Political Parties enjoy an almost unfettered exemption from payment of income tax, a benefit not enjoyed by any other charitable or non-profit non-governmental organisations”.

9. The bench further noted that free air time given to Political Parties during election is actually money spent by the government for the political parties. Though the amounts may be small but they contribute to the kitty of Political Parties at the Government cost.

10. Based on the above observations, the bench further emphasized that “[…] We have, therefore, no hesitation in concluding that INC/AICC, BJP, CPI(M), CPI, NCP and BSP have been substantially financed by the Central Government and, therefore, they are held to be public authorities under section 2(h) of the RTI Act […]”.

11. The bench further maintained that “In view of the nature of public functions performed by Political Parties and the dicta of the High Court, we conclude that Political Parties in question are Public Authorities under section 2(h) of the RTI Act”.

Final Judgement:

After due deliberations and hearing to arguments and counter-arguments, the bench held that:

1. “In view of the above discussion, we hold that INC, BJP, CPI(M), CPIO, NCP and BSP have been substantially financed by the Central Government under section 2(h)(ii) of the RTI Act. The criticality of the role being played by these Political Parties in our democratic set up and the nature of duties performed by them also point towards their public character, bringing them in the ambit of section 2(h). The constitutional and legal provisions discussed herein above also point towards their character as public authorities […] and it is held that AICC/INC, BJP, CPI(M), CPI, NCP and BSP are Public Authorities under section 2(h) of the RTI Act”.

2. “The Presidents, General/Secretaries of these Political Parties are hereby directed to designate CPIOs and the Appellate Authorities at their headquarters in 06 weeks time. The CPIOs so appointed will respond to the RTI applications extracted in this order in 04 weeks time. Besides, the Presidents/General Secretaries of the above mentioned Political Parties are also directed to comply with the provisions of section 4(1) (b) of the RTI Act by way of making voluntary disclosures on the subjects mentioned in the said clause”.

After Effect

Now that the Political Parties are in, the question now arises whether or not the Sports Bodies such as Board of Cricket Control of India (BCCI), Hockey Federation of India should also come under RTI. These bodies also enjoys benefit from the central and state governments directly and indirectly (income tax-exemption, free/lease (at a concessional rate) land, entertainment tax-exemption during major matches, use of stadiums at a nominal rate, etc.), and should also be accountable to the citizens of this country. Owing to the arguments, counter- arguments and observations, don’t you think our popular Sports Bodies should also come under RTI ?

Aamjunta – what do you think?