National Parties Collected Over Rs 15,000 Crore From Unknown Sources: ADR Report

Between FY 2004-05 and 2020-21, the national parties have collected Rs 15,077.97 crore from unknown sources, according to an analysis report of ADR (Association of Democratic Rights).

As per the report, total income of national and regional parties from unknown sources for FY 2020-21 is Rs 690.67 crore,

Political Parties play a key role in democracies as they contest elections, form governments, formulate policies and are responsible for providing governance and improving the lives of the common man.

Political parties need access to money in order to reach out to the electorate, explain their goals/policies and receive inputs from people. But where do they collect their funds from?

An analysis of their Income Tax Returns and donations statements filed with the Election Commission of India (ECI) shows that the sources remain largely unknown.

At present, political parties are not required to reveal the name of individuals or organisations giving less than Rs 20,000 nor those who donated via Electoral Bonds.

As a result, more than 36 per cent of the funds cannot be traced and are from ‘unknown’ sources.

While the national and regional political parties were brought under the RTI Act by the CIC ruling in June 2013, they have still not complied with the decision.

Full transparency is, unfortunately, not possible under the current laws, and it is only the RTI that can keep citizens informed.

For this analysis, eight National parties (BJP, INC, AITC, CPM, NCP, BSP, CPI and NPEP) and 27 Regional Parties (AAP, AGP, AIADMK, AIFB, AIMIM, AIUDF, BJD, CPI(ML)(L), DMDK, DMK, GFP, JDS, JDU, JMM, KC-M, MNS, NDPP, NPF, PMK, RLD, SAD, SDF, Shiv Sena, SKM, TDP, TRS and YSR-Congress) were considered.

However, BSP declared that it did not receive any funds from voluntary contributions (above or below Rs 20,000)/Sale of Coupons/Electoral Bonds or unknown sources of income.

For FY 2020-21, 8 national political parties have declared Rs 426.742 crore income from unknown sources and 27 regional parties received Rs 263.928 crore income from unknown sources.

During FY 2020-21, INC declared Rs 178.782 crore as income from unknown sources which is 41.89 per cent of the total income of national parties from unknown sources (Rs 426.742 crore).

BJP declared Rs 100.502 crore as income from unknown sources which is 23.55 per cent of the total income of national parties from unknown sources.

Top 5 regional parties’ unknown income: YSR-Congress - Rs 96.2507 crore, DMK - Rs 80.018 crore, BJD - Rs 67.0034 crore, MNS - Rs 5.773 crore and AAP - Rs 5.352 crore.

Out of Rs 690.67 crore as income from unknown sources, share of income from Electoral Bonds was Rs 325.06 crore or 47.06 per cent.

Electoral Bonds received by eight national parties was Rs 74.46 crore and 27 regional parties was Rs 250.60 crore.

Combined income of INC and NCP from sale of coupons between FY 2004-05 and 2020-21 stands at Rs 4261.83 crore.

There are reporting discrepancies in the audit and contribution reports of 7 political parties for FY 2020-21. These seven parties include AITC, CPI, AAP, SAD, KC-M, AIFB and AIUDF.

In most cases, the share of donations above Rs 20, 000 declared by parties in their contribution reports does not match such income shown in their audit reports.

This makes it difficult to arrive at an accurate figure of their income coming from unknown sources.

For this report, known sources have been defined as donations above Rs 20,000, whose donor details are available through contributions report as submitted by national parties to the ECI.

The unknown sources are income declared in the IT returns but without giving source of income for donations below Rs 20,000.

Such unknown sources include ‘donations via Electoral Bonds’, ‘sale of coupons’, ‘relief fund’, ‘miscellaneous income’, ‘voluntary contributions’, ‘contribution from meetings/morchas’ etc.

The details of donors of such voluntary contributions are not available in the public domain.

Other known sources of income include sale of moveable and immoveable assets, old newspapers, membership fees, delegate fee, bank interest, sale of publications and levy whose details would be available in the books of accounts maintained by political parties.

Total Income Of Political Parties

Total income of eight national political parties in FY 2020-21: Rs 1373.783 crore.

Total income of 27 regional political parties in FY 2020-21: Rs 530.703 crore.

Total income of political parties from known donors (details of donors as available from contribution report submitted by parties to Election Commission and analysed by ADR - National and Regional parties): Rs 713.143 crore, which is 37.40 per cent of the total income of the parties.

Total income of political parties from other known sources such as sale of assets, membership fees, bank interest, sale of publications, party levy : Rs 500.673 crore, or 26.30 per cent of the total income.

Total income of political parties from unknown sources (income specified in the IT Returns whose sources are unknown): Rs 690.67 crore, which is 36.30 per cent of the total income of the parties.

Out of Rs 690.67 crore as income from unknown sources, share of income from Electoral Bonds is: Rs 325.06 crore or 47.06 per cent.

Income from Unknown Sources

Out of total income of Rs 690.67 crore of eight national and 27 regional parties from unknown sources, 47.06 per cent or Rs 325.06 crore came from Electoral Bonds.

Income from sale of coupons declared by INC, NCP and CPM formed 39.72 per cent (Rs 169.515 crore) of income from unknown sources.

Donations from Voluntary Contributions (below Rs 20,000) formed 40.12 per cent (Rs 171.1957 crore) in income from unknown sources of the eight national parties.

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