On 14 May 2016, electoral officials in Tamil Nadu seized around Rs 570 crore in cash in Tirupur district. State Bank of India officials had to come forward with documents to prove that the money was ear-marked for an inter-bank transfer and not for election purposes. But the fact that the Election Commission (EC) made such a gigantic seizure does raise questions whether the EC is in fact conducting arbitrary seizures during election season.
As is the case with most elections in India, the current round of state elections in Assam, West Bengal and Tamil Nadu have generated extraordinary amounts of cash and other goods that are allegedly destined to be used for bribing voters. According to media reports, as of 28 April 2016, the EC had allegedly seized a total of Rs 113 crore in all the poll-bound states, with a majority of it being in Tamil Nadu. As always, traders and businessmen have been complaining that the EC is harassing them and seizing legitimate cash that has no connection with political parties. The EC’s latest Compendium of Instructions on Election Expenditure Monitoring, a document that outlines the scope and aims of EC officials during elections, states that the surveillance teams of the EC can search vehicles belonging to political candidates (as well as their agents and party workers) and seize any amount above Rs 50,000 if they suspect that the money is likely to be used for electoral bribing.
In a country where large cash transactions are routine, such instructions are bound to cause concerns, especially for small traders and businessmen. There is no law preventing large cash transactions in India—it is only illegal to evade taxes on such transactions at the end of the year. For instance, cattle traders in Tamil Nadu have claimed that, because they sell multiple cattle for cash, their trade will be hit by a restriction limiting cash transfers to Rs 50,000. Similarly, on 2 April, a Salem-based merchants’ association filed a PIL before the Madras High Court on the grounds that it is a common practice in business to transfer large amounts of cash for purchase of goods, and that during election season, such cash being transferred was being seized by the EC despite there being no links to political parties. The PIL also alleged that the EC was indiscriminately seizing cash without clearly specifying the documents that would exempt such cash from seizure. On 2 May, a bench headed by the chief justice of the court Sanjay Kishan Kaul declined to admit the PIL and ordered the EC to be more vigorous with its seizures without harassing innocent people.
Notwithstanding the high court’s dismissal of the PIL, there are serious questions about the legality of the EC’s power to conduct such indiscriminate search and seizures. In fact, in 2012, the Gujarat High Court ruled against the EC on this very issue.
In 2012, Bhagyoday Janparishad, a non-governmental organisation in Gujarat challenged the constitutionality of the search and seizure powers of the EC. The NGO stated that the EC was causing havoc by harassing and seizing cash belonging to small businessmen and farmers, who necessarily had to conduct their business with cash. At the time, Section 4.7.1 of Instructions on Election Expenditure Monitoring, issued in July 2012 by the EC for the upcoming Assembly Elections in Gujarat allowed its bureaucrats to seize any “unexplained cash without proper documents” if it was “found in the possession of any person and is suspected to be used for bribing the voters.” The instruction further specified that “if cash found is more than Rs 2.5 Lakh and no criminality is suspected, i.e., without any election campaign material and no party functionary or worker of the contesting candidates/parties are not present in the vehicle, to prove the nexus, then the Assistant Director of Income Tax in charge of the district has to be informed. The Assistant Director will depute the Inspector or himself reach the spot for taking action as per Income Tax Laws.”
It is necessary to understand that these “Instructions” issued by the EC do not have the force of the law: there is no parliamentary legislation allowing the EC to conduct random search-and-seizures. Police officers or income-tax officials working in tandem with the EC can still conduct search and seizures, but they are required to follow safeguards under the Code of Criminal Procedure, 1973 and the Income Tax Act, 1961. According to these, too, officers cannot conduct random search and seizures. They are required to have either search warrants from court or authorisation from superior officers. In some situations, the police can carry out searches without warrants, but even then, they are required to record their reasons in writing prior to the search. The fact that Parliament has thought it necessary to place so many restrictions on the power of the executive to breach the privacy of citizens is an indication that it is not open for officers not authorised by Parliament to conduct random search-and-seizures.
The challenge raised by Bhagyoday Janparishad on the above grounds was successful. In a judgment dated 9 November 2012, the Gujarat High Court, while reprimanding the EC for its conduct, noted:
“We are of the opinion that in the zeal to ensure free and fair poll, a fundamental right as embodied under Article 21 of the Constitution of a common man no way concerned with any political party or election, except his right of franchise, cannot be permitted to be infringed in the manner as it is sought to be done as on today…The power which the Election Commission has bestowed upon its surveillance team is alien to our system.”
Not only did the court find that such search-and-seizures were violative of a citizen’s right to privacy but also that the EC did not have any powers to conduct them under the Representation of People Act, 1951. However, since using money to bribe voters is still an offence under Section 171B of the Indian Penal Code, the High Court allowed the EC to conduct search-and-seizures if it had reliable or credible information, provided that the seizure was conducted only by the authorised police officers under the provisions of the Code of Criminal Procedure.
At the time, the Election Commissioner hurriedly appealed this judgment to the Supreme Court of India. On the first date of hearing, the Supreme Court declined to stay the judgment of the Gujarat High Court but it allowed the EC to amend its guidelines pending its disposal of the appeal. The amended guidelines proposed by the EC allowed its bureaucrats to seize any amount over Rs 50,000 or any item worth more than Rs 10,000 found in a vehicle carrying a candidate, his agent or party worker, and which could be used as inducement of electors. In other words, according to the amended guidelines the EC cannot seize money from the common citizen. However, this does not settle the important constitutional issue of whether the EC has the power to conduct such seizures. Unfortunately, despite four years having passed, the Supreme Court is yet to decide this case.
At this stage, the question is how is the EC seizing such vast amounts of cash despite being restrained by the narrow confines of the consent order in the Bhagyoday Janparishad case. The two important ingredients of the order are first, that only vehicles of political parties or their agents can be searched and, second, that there needs to be evidence that the money is being used for the purpose of bribing voters. The threshold for seizure is, then, quite high, and it is extremely difficult to believe that the EC has managed to seize Rs 131 crore after adhering to the law laid down in the Janparishad case. From news reports, it appears that the EC is still seizing people without political affiliation—if not, we would have had a neat party-wise breakup of funds. According to the ToI, of the Rs 61 crore seized in Tamil Nadu since 4 April, only Rs 20 crore could be traced to political parties. The remaining money seemingly belonged to traders. If this is true, it is spectacular evidence of the EC being indiscriminate in its cash seizures.
Another reason for high cash seizures during these elections is that the EC has changed tactics for by targeting not just cash in transit, but also cash stored on private premises. In a news report in the Hindustan Times, an EC official explained that the commission was traditionally handicapped by the fact that the state and central police forces working under it during elections were unable to enter private premises without a warrant to search for cash. This is because any offence under Section 171B is a non-cognisable offence, i.e. the police cannot conduct an investigation or arrest without a court order. The EC is well aware of this limitation and has been asking the government to convert S. 171B into a cognisable offence so that police authorities can conduct arrests without the requirement of a court order. That proposal is currently pending with the government. (Given this limitation, the interim solution formulated by the EC was to include the Income Tax Department within its fold, since the latter has broader powers for cash seizures. The report said that the majority of tips leading to cash seizures in such cases are anonymous messages to a Whatsapp number established by the EC as a hotline.
Under Section 132 of the Income Tax Act, certain tax officials do have the power to conduct a search-and-seizure if they have reason to believe that a person is not disclosing their entire income or assets to the government. But the IT department has no jurisdiction to raid premises on the suspicion that money is being used for electoral offences. Even when raids are conducted for tax evasion, the tax commissioner conducting the raid is required to have a written order from a superior officer authorising the raid. The order should also mention the reasons leading to the belief that the premises contain undisclosed income. Anonymous tips on Whatsapp cannot constitute reasonable belief.
On 16 May, a questionnaire was sent to the EC asking for a list of all the political parties from whom funds were seized as well as a list of people from whom money was wrongly seized. In its response, the EC merely referred us to the Election Expenditure Monitoring compendium. This questionnaire included a query about the TOI claim that bank accounts were being monitored and asked under which law the EC was carrying out its seizures.
As the great Indian election carnival rolls through the various states, the bureaucrats of the EC of India become the de-facto sarkar for more than a few months. However, little has been reported on the EC’s reach. In the media’s eyes, the EC can do no wrong once the election notifications are issued. So enamored is the media by the efforts of the EC to keep in check corruption in politics, that it forgets that this army of bureaucrats employed by the EC are drawn from a civil service which is also often criticised for its corruption and inefficiency. We see little media scrutiny or criticism of the EC’s functioning.
It is however time to raise these questions especially since elections in India have become increasingly longer – simple state elections are being conducted in multiple phases under heavy para-military presence. The dangers of executive over-reach in India are well documented, especially when it comes to cash seizures by revenue authorities. To justify such arbitrary and abusive powers in the name of ensuring the sanctity of democratic elections is hypocrisy at its worst. An unelected bureaucracy cannot be given a blank cheque to violate civil liberties, especially when that bureaucracy is not accountable to elected representatives, as is the case with the EC during elections. It is time for parliament to step in and lay down the rules for conducting elections and regulating the EC’s powers.
Prashant Reddy Thikkavarapu studied law at the National Law School of India University and Stanford Law School, and is currently a research associate at the school of law at Singapore Management University. He tweets as @preddy85.