Supreme Court of India: Election Commission can disqualify candidates filing False Accounts

Background

It is a well-known fact that in India candidates who are contesting election, at times, spend crores of rupees even though there is a ceiling on the amount of money a candidate can spend for election campaigning. The law prescribes a limit on expenditure so that people/candidates of humble background can also contest in Elections and have a fair chance against the might of money. However, the law relating to Election Expenditure and who has the power to keep a check on the said expenditure is complex and slightly ambiguous.

The Supreme Court of India on 5th May, 2014 gave a landmark judgment (Ashok Shankarrao Chavan v. Dr. Madhavrao Kinhalkar & Ors. With Madhu Koda v. Election Commission of India & Smt. Umlesh Yadav v. Election Commission of India & Ors.) with respect to the powers of Election Commission of India (“ECI”) to conduct an enquiry into the accounts of daily expenditure submitted by the candidates who are contesting in general elections and the powers of ECI to disqualify a candidate in case the Account of expenditure is false or incorrect.

As per Representation of People’s Act, 1951 (“RP Act”), section 77 & 78, every candidate contesting in general elections has to keep a correct account of his daily expenditures incurred during his Election Campaigning (“Account”) (under section 77 of RP Act). Such account of the expenditures has to be submitted to the District Election Officer (“DEO”) of ECI (under section 78 of RP Act) who then ascertains whether the same have been filed in the prescribed time and manner, as per the rules and with all required details or not. After DEO checks the same he prepares his report whether the accounts are as per law or not and forwards the same to ECI. Based on such report ECI decides under section 10A of the RP Act whether or not the candidate has filed his Account in proper manner as per law or not. In case the Account has not been filed as per law, the ECI sends a notice to the candidate to justify as to why Account was not filed in the prescribed time and manner.

In case the candidate fails to justify the reasons for non-filing or filing the Account without confirming to the time and manner as per law then under section 10A of RP Act the ECI can disqualify the candidate from all parliament or State Assembly elections for three years from date of order.

Further, it is the law that any dispute with respect to an Election has to be decided by the Election Tribunal (High Court) under the RP Act.

Certain allegations were made against the ex-chief minister of Maharashtra (with respect to 2009 Assembly Elections) pertaining to over expenditure by means of Paid news publications in local Newspapers. It was alleged that the candidate spent crores of rupees over paid news but did not account the same in its Accounts of Election expenses. It was also alleged that the Account filed by the candidate were false and incorrect (but in proper format and within time) and thus was a corrupt practice.

The ECI took cognizance of the matter and initiated an enquiry into the correctness/falsity of Accounts filed by the concerned candidate. The concerned candidate challenged the jurisdiction of the ECI stating that ECI has no jurisdiction to ascertain the truthfulness of the Account. It was contended that, at best ECI has the jurisdiction to check whether the Account was filed in correct format and within time. It was stated that ECI cannot conduct an enquiry into the Account of expenditure solely on a complaint filed by some random voter.

It was further alleged by the candidate that since it is the elected (winning) candidate hence if there is any dispute it can only be contested by an Election Tribunal (High Court) under section 77, 78, 80 and 123 of the RP Act and not by the ECI under section 10A.

The candidate relied upon the judgment of Sucheta Kripalani v. S.S. Daulat[1], to state that the ECI can only ascertain the form/format of the Account that have been filed and cannot get into whether the Account is correct or incorrect.

However, after the judgment of Sucheta Kriplani, various changes were brought in the RP Act and a new section, Section 10A was inserted under which the ECI was given the power to disqualify a candidate in case the Accounts are not in the manner provided by the law. The problem was the interpretation of the words “in the manner as per Law”. There was no clarity whether ‘manner as per law’ meant that ECI has the power to check only if the Accounts were filed in the prescribed format or whether ECI had the power to go into correctness of the Account as well.

The ECI relied upon the judgment of  L.R. Shivarama Gowda v. T.M. Chandrashekhar[2] and the case of Dal Chand Jain v. Narayan Trivedi[3] to state that ECI has the power to conduct an enquiry into correctness of accounts.

Important Arguments by ECI

1. In case the candidate has exceeded maximum limit of expenditure prescribed for campaigning [given in section 77(3)], then it is a corrupt practice under section 123.

2. Secondly, as per section 77(1) & (2) the candidate is required to keep correct Accounts. Hence even if the Accounts submitted by the candidate are incorrect then also it is an offence and under section 10-A of RP Act and the ECI has power to disqualify the candidate.

Court's Reasoning

The Honourable Supreme Court held that ECI has the power under section 10A to conduct an enquiry into the veracity/correctness of the Account of Expenditure maintained and submitted by a candidate. This judgment has given power to the ECI to check over expenditure by rich candidates.

1. The appellants raised the contention that under Article 329 (b)[4], no election can be called in question except by way of an election petition and the exercise of powers by the ECI under section 10A is clearly ultra vires Article 329 (b).

The Court clarified that “under Section 10A, there is no scope of power vested with the ECI to declare the election as invalid. In other words, exercising power under Section 10A, the Election Commission cannot set aside the election of a successful candidate. Section 10A talks of only an order of disqualification that can be passed by an Election Commission. Further, such disqualification order can be passed for failure to lodge an account of election expenses”.

Just because, the very same allegation of a corrupt practice may form part of the failure to lodge the account in the manner required by or under the Act and it may also constitute one of the grounds in challenging the successful election of a candidate concerned in an Election Petition, it cannot be assumed that once the Election Petition having been rejected for want of particulars, a complaint under Section 10A cannot be pursued and jurisdiction of ECI would stand excluded.

Thus the scope of an Election Petition to be tried by an Election Tribunal and the scope of an order of disqualification to be passed under Section 10A are entirely different matters and one does not conflict with the other.

2. The Court also cited the principle of construction ut res magis valeat quam pereat[5]. By applying this principle of interpretation, the court held that:

“If the submissions were to be accepted and it will have to be held that Election Commission will have no jurisdiction to make an enquiry for the purpose of ascertaining the fulfillment of the requirement as contained in Section 10A then the very provision, namely, Section 10A will have to be rendered otiose. We are, therefore, not able to accede to the said submission.”

3. The court stated that the conduct of elections takes place in the realm of public domain, the operation of such election is widespread and spread over whole of the constituency.

It would be imprudent to assume that ECI would have access to knowledge about all kinds of illegality and irregularity indulged in by the candidates concerned, irrespective of the fact that ECI installs a large number of personnel functioning exclusively for the purpose of holding the elections.

Such instances of illegalities committed by the candidates contesting in the election in certain areas of the constituency may come to the notice of some independent individuals, which may have a serious ramification relating to the conduct of the candidate by abusing the process of the election with the aid of money power available with such candidate.

Thus, the court held that:

“Therefore, if someone is able to assert such misuse of funds in the process of election by a candidate by making an inspection and if the concerned individual finds out that such misuse of funds had taken place, which was not disclosed in the statement of account of election expenses, he will have every right to bring it to the notice of the Election Commission and the very purport of providing such a right under Rule 87 and 88 of Conduct of Election Rules, 1961 when read along with Section 10A makes it clear that he would have every locus to prefer a complaint.

It may be stated that once any such misfeasance in the submission of the account of the election expenses is brought to the notice of the Election Commission, thereafter it would be for the Election Commission to set the process in motion for deciding the issue as contemplated in Section 10A of the Act. It cannot be said that no person can by way of a complaint approach the Election Commission.”

In the next post, I will publish my opinion on this case.

Note - Unless otherwise indicated, all posts by a regular or guest contributor to this blog reflect the contributor's own personal opinions and views and not of any institution to which the contributor may be affiliated. Posts should not be attributed to the blog as a collective effort or to any other regular or guest contributors.

Read about Common Cause v. Union of India - A Case on Government Advertising Campaigns

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[1] AIR 1955 SC 758.

[2] (1999) 1 SCC 666.

[3] (1969) 3 SCC 685.

[4] “No election to either House of Parliament or to the House or either House of the Legislature of a State shall be called in question except by an election petition presented to such authority and in such manner as may be provided for by or under any law made by the appropriate Legislature.”

[5] “…if the choice is between two interpretations, the narrower of which would fail to achieve the manifest purpose of the legislation, we should avoid a construction which would reduce the legislation to futility and should rather accept the bolder construction based on the view that Parliament would - legislate only for the purpose of bringing about an effective result”. - Nokes v. Doncaster Amalgamated Collieries Ltd. For more information visit http://www.desikanoon.co.in/2014/05/maxwell-on-interpretation-of-statutes.html