Why SC Must Order a Probe in Gujarat Donation Scandal

Activists say the Supreme Court must take suo motu probe, as regulators have failed to act despite having the data for years.

BY PC BUREAU

New Delhi/Ahmedabad, August 30 – The shocking disclosure that ten virtually unknown political parties in Gujarat received over ₹4,300 crore in donations between 2019 and 2024 has set off a political storm. But beyond the outrage lies a deeper concern: can citizens realistically expect the Election Commission of India (ECI) or the Enforcement Directorate (ED) to act when they have failed to do so for years, despite sitting on this very data?

The facts are now well established. These obscure parties declared only ₹39 lakh in actual campaigning costs, yet reported over ₹3,500 crore in “expenses” to the ECI. Their negligible public presence makes the vast sums they handled look less like political activity and more like money-laundering on an industrial scale.

The names of the parties, many of which are unheard of even in their supposed constituencies, include Lokshahi Satta Party, Bharatiya National Janata Dal, Swatantra Abhivyakti Party, New India United Party, Satyawadi Rakshak Party, Bharatiya Janparishad, Saurashtra Janata Paksh, Jan Man Party, Manavadhikar National Party and Gareeb Kalyan Party. Their near-invisible political presence stands in sharp contrast to the astronomical sums reflected in their financial records.

Observers argue that these outfits are little more than conduits for laundering unaccounted wealth. “Elections are being treated like hawala operations,” said a noted political scientist. “Funds come in, get legitimised through declarations, and then vanish into the coffers of powerful players. This is not electoral democracy; this is financial engineering.”

“Now, we have reached a stage where non-existent parties are being used as money-laundering factories,” said a senior advocate. He described it  as a   organised crime against democracy and called for a Supreme Court-monitored probe.

गुजरात में कुछ ऐसी अनाम पार्टियां हैं जिनका नाम किसी ने नहीं सुना – लेकिन 4300 करोड़ का चंदा मिला!

इन पार्टियों ने बहुत ही कम मौकों पर चुनाव लड़ा है, या उनपर खर्च किया है।

ये हजारों करोड़ आए कहां से? चला कौन रहा है इन्हें? और पैसा गया कहां?

क्या चुनाव आयोग जांच करेगा – या फिर… pic.twitter.com/CuP9elwPaY

— Rahul Gandhi (@RahulGandhi) August 27, 2025

In Gujarat itself, activists have expressed disbelief. “Most people here have never even heard of these parties,” said Ahmedabad-based RTI activist Ramesh Patel. “And yet they are showing thousands of crores in donations. This is a mockery of our system and of the common voter.”

What makes the situation graver is that the information was not hidden. Every donation, every expense figure, and every filing was in the records of the Election Commission. If the ECI chose not to question these figures in the past, why would it act now? The same question applies to the Enforcement Directorate, which has been hyperactive in investigating opposition leaders but silent on this glaring case of possible political money laundering.

This is why many observers argue that the Supreme Court must intervene on its own motion. “When regulators who already have the facts in hand refuse to act, judicial oversight becomes essential,” said a constitutional expert. “The Gujarat revelations are not just about one state — they expose a systemic design to convert black money into white through political channels.”

If the Supreme Court were to take suo motu notice, it could do more than just order an investigation. It could demand answers from both the ECI and the ED on why they remained silent despite years of glaring discrepancies, and whether their inaction amounts to dereliction of duty. It could also examine whether these shell parties should be deregistered, and whether their donors deserve prosecution under money-laundering laws.

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The danger of inaction is profound. If the Gujarat model is allowed to stand, it risks becoming a template replicated across India: phantom parties absorbing thousands of crores, with paperwork neatly filed but democracy hollowed out from within. For voters, it means elections are no longer contests of ideas, but carefully engineered channels for financial laundering.

RTI activist Ramesh Patel put it bluntly: “These parties exist only on paper. If the institutions we trust won’t act, the courts must. Otherwise, the highest bidder decides our democracy.”

The Supreme Court has often styled itself the guardian of the Constitution. In this case, critics say, the very sovereignty of the voter is at stake. Unless the judiciary intervenes, India risks allowing democracy itself to become the most lucrative business of all — with balance sheets signed off by silence.

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The silence of both the Election Commission and the government on the issue has only deepened suspicion. Critics say the ECI, which is empowered to seek clarifications and deregister parties for financial discrepancies, has so far chosen not to act. This inaction, they warn, risks institutionalising a shadow economy of politics where elections are decided not by public mandate but by hidden financial networks.

The Gujarat revelations carry wider implications for Indian democracy. If phantom parties can absorb thousands of crores in donations with almost no political footprint, the question arises whether similar shell entities are being operated in other states. Analysts warn that the practice, if left unchecked, could entrench a parallel political economy where money, rather than votes, dictates outcomes.

As the storm gathers, calls for reform are growing louder. Civil society groups have demanded urgent steps, including stricter audits, transparency in donor disclosures and immediate deregistration of parties that function as financial fronts. For many, however, the larger question remains unanswered: who are the real donors behind the ₹4,300 crore and what political dividends did they expect in return?

The Gujarat case, critics say, may yet prove to be the most brazen reminder that unless electoral funding is reformed, the world’s largest democracy risks becoming the world’s costliest marketplace.

At its core, critics say, the controversy is not about Gujarat alone but about the health of India’s democracy. As one student leader in Delhi put it: “If elections become an industry for laundering money, then the voter is no longer the sovereign — the highest bidder is.”

Unless the Election Commission or the courts act decisively, the Gujarat revelations may stand as a chilling precedent: that democracy in India can be bought, laundered, and sold — all with official paperwork in order.

Parties as Laundering Machines?

Observers say these so-called parties function less as political organisations and more as money-laundering conduits for powerful players. By routing funds through obscure entities, black money can be converted into white — with the ECI’s record books providing a veneer of legitimacy.

“This is not just electoral fraud. This is organised crime against democracy,” said a political analyst, noting that such practices undermine fair elections and place public trust on the auction block.

Unanswered Questions

The revelations spark troubling questions:

• Who are the real donors behind these shell parties?
• Why has the Election Commission not flagged the disproportionate figures?
• What role, if any, did mainstream political forces play in this shadow financing?

Democracy Not for Sale

The Gujarat case highlights a dangerous precedent: the creation of electoral fronts that serve no democratic purpose but to wash illicit money. Without urgent reforms in transparency and accountability, experts warn that India risks normalising a parallel black-money-driven electoral economy.

Obscure Gujarat Parties: Donations vs Expenditure (2019–2024)

These parties reported massive donations and declared huge “expenses,” but their real election activity was negligible — pointing to their role as shell outfits for laundering political funds.