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Breaking: Not Just Candidates, Their Spouses & Dependents Too Should Reveal Source Of Income & Assets While Filing Nomination: SC [Read Judgment]

LiveLaw News Network
16 Feb 2018 5:38 AM GMT
Breaking: Not Just  Candidates, Their Spouses & Dependents Too Should Reveal Source Of Income & Assets While Filing Nomination: SC [Read Judgment]
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In a landmark decision, the Supreme Court today "allowed" the prayers in a PIL filed by NGO Lok Prahari seeking steps to prevent MPs and MLAs from amassing disproportionate assets and to make it mandatory for not only candidates but their spouses and dependents also to reveal their source of income.

Justice J Chelameswar said "the prayers in the petition are allowed. Only those which require amendment of the law are not allowed as it is up to the Parliament to take a decision".


The bench has granted the prayer of the petitioner to direct necessary amendments to Form 26 of Rule 4A of the Conduct of Elections Rules of 1961 so as to require candidates to declare on affidavit theirs as well as their associates’ sources of income.

However, the prayers for the issue of the writ of mandamus to direct amendment in the Representation of People’s Act of 1951 to provide for rejection of nomination on the ground of furnishing of incorrect information in the said Form 26, as well as amendment to section 9A of the Act of 1951 to include contracts with any government or public company by any HUF/trust/partnership firm/private company in which a candidate or his dependents have a share or interest have not been granted in view of the settled position that a writ cannot be issued to a legislature to amend a law.

The bench also ordered an investigation/inquiry into the disproportionate increase in the assets of MPs/MLAs/MLCs named in the list annexed to the petition as well as the establishment of a permanent mechanism to investigate other legislators whose assets have increased by more than 100% by the next election.

The prayer of the petitioner seeking a direction that non disclosure of assets and the sources of income by candidates, their dependents and associates shall amount to ‘undue influence’ for the purpose of Section 123(2) of the Act of 1988 and that the election of such a candidate can be declared null and void under Section 100(1)(b) of the Act of 1951 has also been allowed, with the bench relying on the judgment in Krishnamoorthy [(2015) 3 SCC 467].

Relief by way of information under Form 26 regarding any contracts with the government of the candidate or his dependents, either directly or through a HUF/trust/partnership/private company has also been granted.

To further modify Form 26 to require information on the provisions in sections 8A, 9, 9A, 10 and 10A of the Representation Of Peoples Act  regarding disqualification which may render a candidate ineligible to contest has also been permitted.

The bench of justice J Chelameswar and S Abdul  Nazeer was pronouncing judgment on the public interest litigation filed by 'Lok Prahari' an NGO which fights against corruption, that sought effective measures to prevent politicians-MPs/MLAs from amassing disproportionate assets.

It had also sought the court's direction to politicians to disclose their source of income in their nomination papers/affidavits before returning officers. It also wanted revelation of the assets of the candidate's spouses and dependents.

The bench which had on September 12 last year reserved judgment after extensive hearings,  had during the hearing directed the Central Board of Direct Taxes to file an affidavit as to what action had been taken against lawmakers whose assets jumped by over 500 percent after being elected and were suspected of amassing disproportionate wealth.

Though the bench on September 7 last year angrily rejected the first affidavit calling it vague, later the CBDT said it was investigating allegations that seven MPs and 98 MLAs a preliminary assessment of a further 42 MLAs was underway. Initially, 26 Lok Sabha MPs, 11 Rajya Sabha MPs and 257 MLAs whose names were handed over by Lok Prahari were probed.

The Centre had during the hearing assured the bench that it would amend within three months, Form 26 of the Conduct of Election Rules, 1961, used by the candidates contesting assembly and Lok Sabha elections, to file affidavits along with nomination paper before the returning officers.

The amendment has been recommended by the Election Commission, following Lok Prahari’s PIL  seeking information about the source of income of the candidates, their spouses, and dependents and to add fresh columns in the affidavit for it

S.N.Shukla, the founder of Lok Prahari, who has been appearing in person in this case, has also sought a declaration whether the candidates or their spouses/dependents have any subsisting contracts with the government or a public company or any share or interest in a private company.

His other prayers included a direction to Parliament to amend the law to disqualify a lawmaker if he has a share or interest in a firm that enters into a business contract with the government or a public company.

Calling for quick action against MPs and MLAs possessing disproportionate assets, the bench had observed the government should notify special fast-track criminal courts to try MPs and MLAs in corruption cases and the judge should be directed to complete the trial in a time-bound manner.

Making stinging observations, Justice Chelameswar had wondered if the mercurial rise in the assets of politicians just within a span of five years between two successive elections, was a product of ineffective investigation or of some “immunity” provided to them.

“If an MLA’s or MP’s assets have seen a 10 time rise in 2019 from what he revealed in 2014 should you not conduct an inquiry into the very propriety of a person holding public office enjoying such phenomenal rise in his assets ... The moment a candidate has shown 1,000% increase in his income in the past five years, please have a mechanism to conduct an enquiry,” Justice Chelameswar had asked the government.

“Income under each head should be probed. All these should be inquired. The public needs an answer. The people should get to know the state of affairs. It is not enough that a legislator discloses a legitimate source of income. It is important to inquire that how did the person get in that position to earn that income”, he had said .

Read the Judgment Here

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