Question

Critically analyse the Supreme Court’s ruling in ADR v. Union of India (2024).

Hint:

When analysing constitutional judgments: (1) Identify rights involved, (2) Apply proportionality, (3) Connect to basic structure, (4) Critically evaluate limits & future implications.

Answer 1

The Supreme Court’s judgment in ADR v. Union of India (2024) is one of the most significant election law decisions since \textit{PUCL (2003)} and \textit{Indira Gandhi v. Raj Narain (1975)}. The Court unanimously struck down the Electoral Bonds Scheme (EBS), amendments to the Companies Act, 2013, Representation of the People Act, 1951, and Income Tax Act, on grounds of violating the fundamental right to information under Article 19(1)(a) and the constitutional requirement of free and fair elections.
A critical analysis requires examining both the strengths and limitations of this ruling.
1. Affirmation of Transparency as a Constitutional Value
The ruling strongly reinforces the principle that:
\[ Political transparency is part of the right to freedom of speech under Article 19(1)(a). \] This is consistent with earlier jurisprudence:

\textit{ADR (2002)} → right to know criminal antecedents
\textit{PUCL (2003)} → right to know assets
\textit{Raj Narain (1975)} → people have the right to know acts of government
The Court held that secrecy in political donations destroys the level playing field, distorts democratic choice, and undermines electoral integrity. This is a doctrinally consistent and constitutionally robust position.
2. Application of the Proportionality Test
The Court used the four-prong proportionality test:

Legitimate goal
Rational connection
Necessity (least restrictive alternative)
Balancing of interests
The government argued that anonymity was required to prevent “retaliation” against donors.
The Court rejected this because:

less restrictive alternatives existed (regulated disclosure, post-election reporting, anti-victimisation law),
the degree of secrecy was excessive and disproportionate.
This is a major evolution in constitutional law—rarely has the Supreme Court applied proportionality so rigorously.
3. Striking Down Unlimited Corporate Funding
One of the most progressive aspects of the judgment is the invalidation of:

removal of the 7.5\% donation cap under Section 182(1) of the Companies Act,
removal of disclosure requirements for corporate donations.
The Court emphasised that:
“Corporate contributions pose a greater risk of quid pro quo corruption than individual donations.”
This brings India closer to international standards (e.g., UK, Canada) where corporate political funding is tightly regulated.
4. Strengthening the Doctrine of Free and Fair Elections
By tying transparency to the Basic Structure, the Court reiterated that: \[ Free and fair elections cannot exist without informed voting. \] This links:

Art. 19(1)(a) (information)
Art. 14 (equality of political competition)
Basic structure doctrine (electoral fairness)
It revives judicial vigilance in election matters after decades of judicial restraint.
5. Criticisms and Limitations of the Judgment
Despite its strengths, the ruling is not without critiques:
(a) Judicial Overreach?
Some critics argue that regulating political finance is a legislative function.
However, since fundamental rights were implicated, the Court justified intervention.
(b) No Immediate Structural Framework to Replace EBS
The Court struck down the scheme but did not:

provide a transitional mechanism,
mandate a uniform donation disclosure system,
lay down guidelines for future political finance regulation.
This leaves a vacuum until Parliament enacts a new law.
(c) Does Not Address Electoral Trusts or Cash Donations Fully
Large volumes of political money still flow through:

electoral trusts,
shell companies,
cash donations below ₹20,000.
The judgment attacks anonymity in bonds but not opacity in other channels.
(d) Enforcement Challenges
The order directing SBI to disclose past donors is welcome, but:

enforcement depends heavily on bureaucratic cooperation,
political backlash is likely.
6. Overall Evaluation
The ruling is a landmark victory for:

voter rights,
electoral transparency,
anti-corruption efforts.
It aligns Indian democracy with global standards and restores judicial oversight over electoral integrity.
However, the judgment leaves open:

the shape of future campaign finance laws,
regulation of corporate political influence,
long-term institutional reform of the Election Commission.
Thus, it is normatively powerful but structurally incomplete. \[ \boxed{The ADR (2024) judgment is transformative in principle, but its long-term success depends on legislative follow-up and institutional commitment.} \]