INCURRING OF ELECTION EXPENDITURE IN EXCSS OF PRESCRIBE LIMIT CHAPTER -1 INTRODUCTION India is a country inhabited by people of different religions, castes and languages, attributing to its richness and vivacity, as also its diversity. In this scenario of diversities, what is of utmost importance is the basic sense of unit)' and integrity that binds together the people all over the country. Unity in diversity is a unique feature of India, owing a great deal to the constitutional system adopted way back in 1950, to guide and mould the destiny of crores of people in the years ahead. The Constitution of India, which declares the country a sovereign socialist secular democratic republic, provided the much needed strong frame, binding together the diverse colours of religion, caste and languages into a single composite rainbow. Now, that India has recently celebrated its golden jubilee of independence, which it achieved on the historic day of 15 August 1947 from British rule, the roots of democracy have been firmly established in the country and it is looked upon by the whole comity of nations the world around, as one of the most stable democracies on the globe.The apex court of the land has rightly described it as an 'oasis of democracy’ 1
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INCURRING OF ELECTION EXPENDITURE IN EXCSS OF PRESCRIBE LIMIT
CHAPTER -1
INTRODUCTION
India is a country inhabited by people of different religions, castes and languages,
attributing to its richness and vivacity, as also its diversity. In this scenario of diversities,
what is of utmost importance is the basic sense of unit)' and integrity that binds together
the people all over the country. Unity in diversity is a unique feature of India, owing a great
deal to the constitutional system adopted way back in 1950, to guide and mould the destiny
of crores of people in the years ahead. The Constitution of India, which declares the country
a sovereign socialist secular democratic republic, provided the much needed strong frame,
binding together the diverse colours of religion, caste and languages into a single composite
rainbow.
Now, that India has recently celebrated its golden jubilee of independence, which it
achieved on the historic day of 15 August 1947 from British rule, the roots of democracy
have been firmly established in the country and it is looked upon by the whole comity of
nations the world around, as one of the most stable democracies on the globe.The apex
court of the land has rightly described it as an 'oasis of democracy’
Election Laws, Practice and Procedure if we look around and compare the record of its
democratic functioning with that of the other nations who also got freedom from foreign
rule more or less around the same time.
Democracy is one of the inalienable basic features of the Constitution of India and forms
part of its basic structure.1
Democracy is government by the people. It is a continual participative operation, not a
cataclysmic, periodic exercise. The little man, in his multitude, marking his vote at the poll
does a social audit of his Parliament plus political choice of his proxy. Although the full
1 Kesavanand Bharati vs State of Kerala AIR 1973 SC 1461.
1
flower of participative government rarely blossoms, the minimum credential of popular
government is appeal to the people after every term for a renewal of confidence. So we
have adult franchise and general elections as constitutional compulsions.2
The concept of democracy as visualised by the Constitution presupposes the representation
of the people in Parliament and state legislatures by the method of election.3
CHAPTER-2
HISTORY OF ELECTIONS IN ANCIENT INDIA
Elections in India are not a new phenomenon or a new concept born in modem times.
Taking decisions to run their affairs, be they at the level of individual families or at the
community level, collectively and with the consensus of all concerned, has been the
pervading philosophy of Indian way of life from times immemorial. Our ancient scriptures
dating back to Vedic age are filled with references to republics and democracies prevailing
in various parts of ancient India. The ancient historians have recorded graphic details of the
people choosing their own heads. ganapaties, of the great Vaishali ganarajya, thousands of
years back, to lead them in times of peace and war. They were assisted by other wise men
and nobles in their decision-making, like the present council of ministers.
Tracing the history of elections and evolution of representative governments in India, the
Election Commission of India observed in its report after the first general elections in
independent India in 1951-52:
...republican forms of government existed in many parts of ancient India There are
numerous references to such Governments in the Buddhist literature. Even in the 4th
Century BC, there was a republican federation known as the Kshudrah-Malla Sangba, which
offered strong resistance to Alexander the Great. The Greeks have left descriptions of many
2 Mohinder Singh Gill and Anor v Chief Election Commissioner and Ors AIR 1978 SC 851.3 NP Ponnusivami v Returning Officer, Namakkal AIR 1952 SC 64
2
other republican states in India, some of which were described by them as pure
democracies while others were said to be 'aristocratic republics'.
Although, full details of the working of the republican forms of government in ancient India
are not available, it is known that in some of these republics every adult male member had
the right to vote and to be present in the general assembly, which decided all public affairs.
With the increase of population and the growing complexities of the social structure, it
became increasingly difficult for all citizens to assemble at one place for the purpose of
deliberation on state affairs, and gradually this resulted in the evolution of some kind of
representative government. We find numerous references to election, referendum, voting,
ballot papers, etc., in the history of the Hindu polity'.
The nature of franchise for election to the popular assemblies is not fully known. While in
the aristocratic republics, the basis appears to have been a family, in other states, all adult
male persons, who were not otherwise disqualified, appear to have had the right to vote. By
naturalisation, even foreigners could become citizens, and acquire the right of vote.
A vote was known as 'chhanda' which literally means a 'wish'. This expressive term was used
to convey the idea that by voting a member was expressing his free will and choice. We also
find description of the methods of collection of votes of citizens who could not be present
at the meeting of the assembly. For purposes of voting in the assembly, there used to be
multi-coloured voting tickets, called 'shalakas (pins). These were distributed to members
when a division was called and were collected by a special officer of the assembly, known as
"shalaka grahak' (collector of pins). This officer was appointed by the assembly as a whole. It
was his duty to take the vote which could be either secret or open.
Apart from the evolution of the democratic form of government in sovereign states in
ancient India as described 3bove, the genius of India also evolved, as a natural growth, the
system of autonomous and almost self-sufficient village communities, under every system
3
of government. These communities, which lasted through the ages, were run on truly
democratic lines without, of course, the outward trappings of the vote and the ballot box. In
later days, they went by the name of village panchayats and were a vital force in the social
life of the countryside.
Even after the republican states were absorbed within empires, the system of
regulating the local corporate life through popular assemblies survived for a very long time.
Almost every imperial conqueror left the conquered states and communities to carry on
their administrative and social system in their own way as before. During the Muslim
period, the affairs of the trade corporations and the villages continued to be carried on by
popular assemblies. A fundamental change came with the British administration when
revenue, judicial and legal affairs were centralised and conducted away from the villages.
This factor, coupled with the consequent decay of the agricultural and industrial economy
of the countryside, resulted in the deterioration of the corporate life of the rural
communities and gradually the organisations based on the popular will faded out.
In the context of history, therefore, the establishment by the Constitution of the democratic
and parliamentary form of government in the country on the basis of adult franchise was
like the rejoining of a historic thread that had been snapped by alien rule. Franchise on a
liberal scale had been common in various parts of ancient India, and by providing for
universal adult suffrage, the country boldly achieved the consummation of its electoral
aspirations on a national basis.
4
INDIA BECOMING SOVEREIGN REPUBLIC ON COMMENCEMENT OF THE
CONSTITUTION.
On the appointed day, that is, 26 January 1950, referred to in the Constitution as the
commencement of the Constitution (art 394), India became an independent Sovereign
Democratic Republic, ceasing to be a dominion within the British empire, and governed by
its own Constitution 'given by the people of India unto themselves'. On that momentous
day, the Constituent Assembly transformed itself, under art 379, into the provisional
Parliament of India and functioned in that capacity till its last sitting on 5 March 1952,
where after the regular Parliament4 came to be constituted in April 1952, on the basis of the
first general elections held under the Constitution between October 1951 and March 1952.
Dr Rajendra Prasad also entered upon his office as interim President of India on 26 January
1950 and functioned in that capacity till he entered upon his office as the first regularly
elected President of India on 13 May 1952.
India, that is Bharat, is a union of states (art (1)]. Originally, the states forming the Indian
union were divided into three categories-the erstwhile nine British Provinces of Assam,
Bihar, Bombay, Madhya Pradesh, Madras, Orissa, Punjab, Uttar Pradesh and West Bengal
were categorised as Part A states, eight bigger princely states or union of such states which
federated into the Indian union, viz, Hyderabad, Jammu and Kashmir, Madhya Bharat,
Mysore. Patiala and East Punjab States Union, Rajasthan, Saurashtra and Travancore-Cochin
were classified as Part B States, and some smaller princely states and the erstwhile Chief
Commissioners' provinces were constituted into 10 Part C states, viz, Ajmer, Bhopal,
Subsequently, the distinction amongst the Part A, Part B and Part C states was done away
with on their reorganisation in 1956 under the Constitution (Seventh Amendment) Act
1956. On such reorganisation, the political map of India got divided into 14 states and six
union territories (centrally administered areas). Thereafter, there have been several
4 The first House of the People was duly constituted on 2 April 1952 and the Council of States was constituted on 3 April 1952.
5
reorganisations of these states and union territories :trom time to time. At present, there
are 25 states and seven union territories in India. From November 2000, the number of
states shall go up :trom 25 to 28.
All these constituent states, except the State of Jammu and Kashmir, are governed by the
common Constitution, that is, the Constitution of India. The State of Jammu and Kashmir
has, however, a separate Constitution, called the Constitution of Jammu and Kashmir.
DEMOCRACY AND PARLIAMENTARY SYSTEM IN INDIA
As the very preamble to the Constitution of India proclaims, India is a sovereign socialist
secular democratic republic. The Constitution has adopted the parliamentary , form of
government, as in vogue in Britain, as the system of governance of India, with an elected
President as the head of the state. Indian parliament is a bicameral legislature, with the
Council of States and the House of the People as its two chambers. India is a union of states,
and each state has its own legislature. The Constitution has reserved in the Seventh
Schedule some subjects for legislation by Parliament and some for the state legislatures,
with some others falling under the concurrent jurisdiction of Parliament and state
legislatures. Elections to the offices of
President and Vice-President of India and to Parliament and state legislatures form part of
the Union List (Entry 72, List I, Seventh Schedule). But subject to laws made by Parliament,
state legislatures are also competent to legislate on matters relating to elections to their
own Houses (Entry 37, List II, Seventh Schedule).
Giving due importance to the conduct of elections in a :tree and fair manner in a democratic
set-up, the founding fathers of the Constitution devoted a separate part, Part XV containing
arts 324 to 329, in the Constitution to elections. Article 324 provides for the setting up of an
independent Election Commission of India for conduct of elections to the offices of
President and Vice-President of India, and of elections to Parliament and state legislatures.
6
Article 325 mandates the preparation of one general electoral roll for each territorial
constituency containing the names of all eligible electors, without discrimination on
grounds of religion, race, caste or sex or any of them. Article 326 has adopted 'universal
adult suftrage' as the basic tenet of direct elections to lower Houses of Parliament and state
legislatures, namely, the House of the People and state legislative assemblies. Articles 327
and 328 empower Parliament and state legislatures to make laws relating to elections.
Article 329 bars the interference of courts in electoral matters when the electoral process is
on.
Originally, the right to be registered as a voter under art 326 was conferred on adult Indian
citizens of the age of 21 years or above. But the Constitution is a living and organic law,
subject to amendments from time to time, to keep pace with the changing needs of the
society and to meet its expectations and aspirations. By the Constitution (Sixty-first
Amendment) Act 1988, the minimum voting age was lowered from 21 years to 18 years
effective from 28 March 1989. The Constitution has been amended from time to time, 81
times so far, in several other respects also, but without changing its basic structure. The last
such amendment was made in June 2000, by the Constitution (Eighty-first Amendment) Act
2000.
CHAPTER-3
WORKING OF ELECTORAL MECHANISM
Thus, the electoral mechanism in India is superintended and controlled by two
constitutional authorities, namely, the Central Election Commission of India for elections to
the offices of the President and the Vice-President of India and to Parliament and state
legislatures, and the State Election Commissions appointed in each state for elections to the
panchayati raj institutions as institutions of local self government.
All matters relating to various aspects of elections to the offices of the President and the
Vice-President of India, and of elections to Parliament and state legislatures have been dealt
7
with at length in the following chapters. In order not to confuse and tax the readers with
too many details relating to elections to panchayati raj institutions, which are governed by
separate state laws of each state concerned, the present book is mainly confined to the
"discussions relating to elections to the offices of the President and die Vice-President of
India and elections to Parliament and state legislatures only. However, salient features of
the panchayati raj institutions and elections to those bodies have been briefly discussed in
the concluding chapter of this book. Basically, elections to these institutions of local self-
government are also held in the same manner as elections to the House of the People and
state legislative assemblies, though under different sets of loca11aws.
Who can stand for Election ?
Any Indian citizen who is registered as a voter and is over 25 years of age is allowed to contest
elections to the Lok Sabha or State Legislative Assemblies. For the Rajya Sabha the age limit is
30 years.
Every candidate has to make a deposit of Rs. 10,000/- for Lok Sabha election and 5,000/- for
Rajya Sabha or Vidhan Sabha elections, except for candidates from the Scheduled Castes and
Scheduled Tribes who pay half of these amounts. The deposit is returned if the candidate
receives more than one-sixth of the total number of valid votes polled in the constituency.
Nominations must be supported at least by one registered elector of the constituency, in the
case of a candidate sponsored by a registered Party and by ten registered electors from the
constituency in the case of other candidates. Returning Officers, appointed by the Election
Commission, are put in charge to receive nominations of candidates in each constituency, and
oversee the formalities of the election.
In a number of seats in the Lok Sabha and the Vidhan Sabha, the candidates can only be from
either one of the scheduled castes or scheduled tribes. The number of these reserved seats is
meant to be approximately in proportion to the number of people from scheduled castes or
scheduled tribes in each state. There are currently 79 seats reserved for the scheduled castes
and 41 reserved for the scheduled tribes in the Lok Sabha.
8
CHAPTER -4
ELECTION EXPENSES
Account of Election Expenses:
Every candidate, either by himself or by his election agent, shall keep a separate and correct
account of all expenditure in connection with the election incurred or authorised by him or
by his election agent, between the date on which he has been nominated and date of the
declaration of the result thereof both dates inclusive. The account shall contain such
particulars as may be prescribed. (Section 77, Act 1951).
With the amendment to Section 77 of the Representation of People Act, 1951 only the
expenses on account of travel of leaders of the political parties, covered under explanation
2 below Section 77, will be exempted from being included in the account of election
expenses of the candidate. All other expenses - incurred/authorized by the political parties,
other associations, body of persons/ individuals-are required to be included in the account
for the candidate.
Rules 86-90 (Part VIII) of the Conduct of Election Rules, 1961 deal with election expenses.
The total expenses in connection with an election in anyone of the Parliamentary
constituencies shall not exceed the prescribed maximum.
9
Maximum election expenses(Maximum election expenses under conduct of
election rules,1961)(Rule 90)
The total of the expenditure of which account is to be kept under section 77 and which is
incurred or authorised in connection with an election in a state or union territory
mentioned in column 2 of the below shall not exceed—
a) In any one Parliamentary constituency of that state or Union territory, the amount
specified in the corresponding column 3 of said table and
b) In any one assembly constituency if any, of that state or Union territory, the amount
specified in the corresponding column 4 of said table -
TABLE5
S No Name of state or Union Territory Maximum limit of election expenses any
one
Parliamentary
constituency
Assembly
constituency
1
State
2 3
Rs
4
Rs
1 Andhra Pradesh 2500000 1000000
2 Arunachal Pradesh 1700000 600000
3 Assam 2500000 1000000
4 Bihar 2500000 1000000
5 Goa 1400000 500000
6 Gujarat 2500000 1000000
7 Haryana 2500000 1000000
8 Himachal Pradesh 2500000 700000
9 Jammu and Kashmir 2500000 ----------
10 Karnataka 2500000 1000000
5 Subs by S.O.1232(E)dated 24th October,2003.(w.e.f.24.10.2003)
10
11 Kerala 2500000 1000000
12 Madhya Pradesh 2500000 1000000
13 Maharashtra 2500000 1000000
14 Manipur 2200000 500000
15 Meghalaya 2200000 500000
16 Mizoram 2000000 500000
17 Nagaland 2500000 500000
18 Orissa 2500000 1000000
19 Punjab 2500000 1000000
20 Rajasthan 2500000 1000000
21 Sikkim 1700000 500000
22 Tamil nadu 2500000 1000000
23 Tripura 2500000 1000000
24 Uttar Pradesh 2500000 1000000
25 West Bengal 2500000 1000000
26 Chhattisgarh 2500000 1000000
27 Uttaranchal 2500000 700000
28 Jharkhand 2500000 1000000
2
Union
Territo
ries
1 Andaman & Nicobar islands 1700000 ------------
2 Chandigarh 1400000 -------------
3 Dadra and nagar havely 1000000 --------------
4 Daman and diu 1000000 ----------------
5 Delhi 2500000 900000
6 Lakshadweep 600000 ------------
11
7 Pondicherry 2000000 500000
Particulars:
According to the Conduct of Election Rules, 1961 the account of election expenses is to
contain the following particulars in respect of each item of expenditure from day- to-day,
namely:
(a) the date on which the expenditure was incurred or authorised;
(b) nature of the expenditure (as for example, travelling, postage or printing and the like);
(c) the amount of expenditure-
(i) the amount paid; and (ii) the amount outstanding;
(d) the date of payment;
( e) the name and address of the payee;
{f) serial number of the entry in case of amount paid;
(g) serial number of bills, if any, in case of amount outstanding;
(h) the name and address of the person to whom the amount outstanding is payable. (Rule
86, 1961) Rules)
A voucher is to be obtained for every item of expenditure, unless, from the nature of
the case, such as postage, travelling by rail and the like, it is not practicable. All the vouchers
are to be lodged along with the account of election expenditure and arranged according to
the date of payment and serial numbers by the candidate or his agent and such serial
numbers are to be entered in the account under item (f) above. It is necessary to give
12
particulars mentioned in item ( e) in regard to the items of expenditure for which vouchers
have not been obtained.
District Election Officer:
Every contesting candidate shall, within thirty days from the date of election of the returned
candidate lodge with the District Election Officer an account of his election expenses which
shall be a true copy of the account kept by him or by his election agent.
Reference to the Election Officer shall, in relation to a constituency in a Union Territory, be
construed as a reference to the Returning Officer for the constituency. (Section 78, Act
1951)
As soon as may be after the expiration of 30 days, the District Election Officer is to report to
the Election Commission -
(a) the name of each contesting candidate;
(b) whether, each candidate has lodged his account of election expenditure and, if so, the
date on which such account has been lodged; and
( c) whether in his opinion, such account has been lodged within the time and in the manner
required by the Act of 1951 and the Conduct of Election Rules, 1961.
If the District Election Officer is of the opinion that the account of election expenses of any
candidate has not been lodged in the manner required by the Act of 1951 and the Rules he
share with every such report send to the Election Commission the account of the election
expenses of the candidate with the vouchers lodged along with it. The District Election
Officer shall publish a copy of the report by fixing the same to his Notice Board. [Rules 89(1),
89(2), 89(3), Rules of 1981].
Commission's guidelines regarding maintenance of account of expenses and
inspection thereof:
13
The Commission vide Order No. 76/2003/JS.II, dated 24.10.2003 has revised the format for
maintaining account of election by candidates ills 77 of the R.P. Act, 1951. (Appendix 1).
The format in which the abstract statement of the expenses giving detailed information
about the expenses have undergone comprehensive changes (Appendix- 2). The format of
the affidavit to be submitted by the candidates (Appendix-3) and the format of the letter to
be handed over to the candidates by the Returning Officers inviting their attention to the
requirements of law regarding filing of account of election expenses (Appendix-4) have also
been modified.
Instructions for contesting candidates for lodging their accounts of election
expenses-inspection of accounts of election expenditure:
The Commission vide Order No.7 6/2003/JS.1I, dated 29.10.2003 reiterated instructions
issued vide letter No. 76/98/J.S. II, dated 19.1.1998 stating that the contesting candidates
are required to maintain their election expenditure account in the prescribed register on
day-to-day basis. They are also required to make available the said register, with supporting
documents, for inspection, at any time during the process of election, to the District
Election Officers/Retuning Officers /Election Observers appointed by the Commission or any
other such authority nominated by the Commission in this behalf It has also been clarified
that the failure to produce this register, on demand, will be considered as a major default.
The register with the said supporting documents shall be made available by the contesting
candidates only once in three days.
The Commission has now prescribed a revised format for maintaining account of election by
candidates under Sections 77 and 78 of the Representation of the People Act, 1951 wde its
letter No. 76/2003/JS.II, dated 24 October 2003. Under Section 77(1) [vide the 'Election And
Other Related Laws (Amendment) Act, 2003', only the expenses on account of travel of
'leaders' of the political parties covered under Explanation 2 will be exempted from being
included in the account of election expenses of a candidate. All other expenses -
14
incurred/authorised by the political parties, other associations, body of person, individuals-
are required to be included in the account of the candidate.
In order to streamline the scrutiny of accounts maintained by the candidates, the
Commission has given the following directions:
1. A register in the standard fonnat as already prescribed vide Commission letter
No 76/2003/JS.II, dated 24.10.2003 shall be issued to each candidate by the Returning
Officer immediately after his nomination, for keeping the day-to-day account of his
expenditure.
2. The register shall be duly page-numbered and authenticated by the District Election
Officer at the time of issue.
3. All day-to-day accounts shall be faithfully recorded in this register and in no
other documents by the candidate or his election agent.
4. All documents such as vouchers, receipts, bill, acknowledgments, etc., in support of the
expenditure incurred or authorised shall be obtained from day-to-day as the expenditure is
incurred- and authorised and maintained in the correct chronological order along with the
aforesaid register as prescribed under rule 86 of the Conduct of Election Rules 1961.
5. The day-to-day account maintained in the aforesaid register together with the
supporting documents shall be made available for inspection once in three days during the
process of election to the District Election Officer/Returning Officer/ Election Observer
appointed by the Commission or any other such authority nominated b)' the Commission in
this behalf.
6. The District Election Officer and the Election Observer shall prepare a schedule of
inspection whereby a three-day cycle of furnishing of accounts will be set for every
15
candidate in such a manner that on each day, accounts of one or more contesting
candidates are made available for scrutiny to the concerned officers. In other words, the
turn of a candidate to furnish his accounts for scrutiny will fall after very third day
throughout the period between the filing of his nomination and declaration of results.
7. The accounts of the candidates will be scrutinised by the District Election Officer/
Returning Officer and/or Election Observer or by the nominated officers and they will keep
two photocopies of the relevant pages of the register. One copy of the relevant pages of the
register will be displayed on the notice board of the Returning Officer and the other copy
will be retained in a separate file for each constituency as proof of record with the
Returning Officer and furnished to the District Election Officer on conclusion of the poll
process.
8. Any person desiring a copy of these day-to-day accounts will be provided the same
by the Returning Officer subject to payment of usual copying charges.
9. While lodging the accounts of the election expenses under Section 78 of the
Representation of the People Act 1951, the candidate shall file the prescribed register along
with the abstract statements of election expenses and the prescribed affidavit prescribed
vide Commission order No. 76/2003/ JS.II, dated 24.10.2003.
Maintenance of accounts of election expenses - Reports by the District
Election Officers:
16
The Commission vide Order No. 76/2oo3/JS.II, dated 2.1.2004 has stated that every
contesting candidate at an election shall, within 30 days from the date of the election of the
returned candidate, lodge with the District Election Officer an account of his election
expenses which shall be a true copy of the account kept by him or his election agent under
Section 77 of the Representation of People Act, 1951. Rule 89 of the Conduct of Election
Rules, 1961 prescribes the manner in which accounts of the candidate shall be lodged and
the steps to be taken by the District Election Officer consequent upon the lodging of the
account of election expenses by the candidate.
The Commission has directed that in tenus of Rule 89 of the Conduct of Election Rules,
1961, all District Election Officers shall report to the Commission under Rule 89(2) the
following:
(a) Name of each contesting candidate who failed to lodge the expenses as prescribed by
the Commission in tenus of its instructions dated 29.10.2003.
(b) The dates on which the accounts were furnished by such candidates during the course of
the elections, and if not furnished, whether notices for non- compliance of the instructions
of the Commission were issued to them and further follow-up action taken, if any.
(c) The discrepancies noticed by the District Election Officers/ Returning Officers/designated
Officers in the accounts submitted every third day by the candidate with the actual
expenditure noted/assessed by the District Election Officer/ Returning Officer/Election
Observer/designated Officer and specifically mentioning the items of expenditure which in
the opinion of District Election Officer/Returning Officer/ Observer, have been suppressed.
(d) Comments of the District Election Officer on the overall final accounts furnished by the
candidates in tenus of actual expenditure incurred by each candidate. In giving his final
comments, the District Election Officer shall taken into account the observations made by
the Election Observers and any other candidate or by any other organizations or member of
the general public on the daily accounts exhibited on the notice board of the Returning
Officer as required under the directions at para 7 of the Commission's instructions dated
29.10.2003. These shall be submitted as annexures to the report that is submitted by the
17
District Election Officer in the profonna (Annexure'XXXVIII) prescribed in para 11.1 of
Chapter XVII of the Handbook of Returning Officers (all elections where EVMs are used),
1998 edition. In the 'Remarks' column of the profonna, the annexure number under which
the comments of the DEO pertaining to a candidate shall be mentioned.
Disqualification in Case of Non-Submission of Accounts:
As soon as may be after the receipt of the report mentioned on the preceding paragraph
the Election Commission shall consider the same and decide whether any contesting
candidate has failed to lodge the account of election expenses within the time limit and in
the manner required by the Act and the Rules. If the Election Commission decides that a
contesting candidate has failed to lodge his account of election expenses within the time
and in the manner required by the Act and the Rules, it shall, by notice in writing, call upon
the candidate to show cause why he should not be disqualified under Section 10-A of the
Act of 1951.
The contesting candidate, who has been called upon by notice to show cause, may, within
20 days of the receipt of such notice, submit in respect of the matter a represenltation in
writing to a Election Commission and shall at the same time and send to the District Election
Officer a copy of his representation, together with a complete account of his election
expenses if he had not already furnished such an account.
The District Election Officer then, within 5 days of the receipt of such representation and
accounts, shall forward to the Election Commission the copy of the representation and the
account, if any, with such comments as he wishes to make thereon. If the Election
Commission is satisfied, after considering the representation submitted by the candidate
and the comments made by the District Election Officer and after such enquiry as it thinks
fit, that the candidate has no good reason or justification for his failure to lodge his
accounts, it shall declare him to be disqualified under Section lO- A of the Act, 1951 for a
period of three years from the date of the order and cause the order to be published in the
18
Official Gazette. (Rule 89(4) to Rule 89(8), Rules of 1961).
The procedure set-out above has been given in some detail here to apprise the contesting
candidates and especially the returned candidates of the serious consequences of not
maintaining the election expenses and lodging the same in time and in the manner provided
in the Act of 1951 and the Conduct of Election Rules, 1961.
Where a candidate fails to submit account of election expenses in prescribed form and time,
he automatically incurs disqualification and it is not necessary for the Election Commission
to afford reasonable opportunity to the candidate before passing order of disqualification,
nor is it necessary to pass reasoned order. There is no question of imposition of any
punishment or stigma on the basis of any discriplinary proceedings against the candidate, as
the disqualification contemplated by Section 10A of the Act is a necessary consequence
flowing from his failure to lodge the account of election expenses within the stipulated
period and in the prescribed manner.6
After lodging the accounts of election expenditure under section lO-A(a) including
particulars as prescribed under Rule 86 if an account is found to be incorrect or untrue after
enquiry by the Election Commission under Rule 89 the Election Commission may hold that
the candidate concerned had failed to lodge his accounts within the meaning of section 10-
A and may disqualify the said candidate. 7
Small Discrepancies:
Small Discrepancies in the accounts do not matter. Rent was incurred for microphone used
during the election. In the return filed by the candidate, the date of the bill was wrongly
mentioned as the date of payment. It was held that no inference against the candidate
could be drawn from this discrepancy. 8
Expenditure before Nomination:
Expenditure before the date of nomination need not be shown in the return of expenses.
6 Capt. Chanan Singh Sindhu v. The Election Commissioner of India, AIR 1992 P. & H.183.7 L.R. Shiuaramagowdav. T.M. Chandrashekar, (1999) 1 SCC 666.8 Nongomban lboucha Singhv. Hisangthem Chandramani Singh, AIR 1977 SC 682.
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Nor would the amount be taken -into consideration in calculating the total expenses of the
successful candidate for detennining whether the election expenses exceeded the
prescribed limit.
In the above case, it was held, that where the allegation is that the candidate incurred
expenses on petrol during election and the jeep used by him was bearing the No. NLM 194,
the evidence must show that petrol was sold for a vehicle bearing that number,
Nongomban Iboucha Singh, v. Hisangthem Chandramani Singh, AIR 1977 SC 682.
Election Expenditure Observers:
The Commission has decided to appoint Election Expenditure Observers to closely watch,
analyse and report to the Commission instances of misuse of money power for
manipulating the will of the electors. The Commission will also determine the magnitude of
election expenditure in the light of the report of these observers.
CHAPTER-5
"INCURRING OF EXCESSIVE EXPENDITURE BY CANDIDATES AND
MAINTENANCE OF ACCOUNTS BY POLITICAL PARTIES" ...
DEFINITION
Corrupt practice of incurring excessive expenditure is defined in section 123(6). Every
candidate at an election shall either by himself or by his election agent keep a separate and
correct account of all expenditure in connection with the election incurred or authorised by
him or by his election agent between the date of publication of the notification calling the
election and the date of declaration of the result thereof, both days inclusive. [Section 78
(1), Act 1951 and section 123(6)].
The maximum amount of election expenditure which may be incurred by the candidates for
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the Parliamentary and Assembly Constituencies in the various states is laid down in Conduct
of Election Rules, 1961. (Rule 90, Rules of 1961). .
Mere non-disclosure of expenditure is not a corrupt practice. It is incurring of
expenditure in excess of the prescribed amount which is covered by the corrupt practice
defined in section 123(6). Contravention of Section 77, sub-section (1) and (2) or failure to
maintain correct accounts with the prescribed particulars does not fall within section
123(6).9
What is referred to in sub-section (6) of section 123 as corrupt practice is only the incurring
or authorising of expenditure in contravention of section 77. It does not take into its fold,
the failure to maintain true and correct accounts. The language of sub- section (6) is so clear
that the corrupt practice defined therein can relate only to sub section (3) of section 77, i.e.,
the incurring or authorising of expenditure in excess of the amount prescribed. It cannot by
any stretch of imagination be said that non- compliance with section 77(1) and (2) would
also fall within the scope of section 123(6).
Consequently, it cannot fall under section 1O O(l)(b). The attempt to bring such non-
compliance within section 100 (1) (d) (iv) must also fail because the essential requirement
under section 100 (1)( d)(iv) is that the result of the election in so far as it concerns the
returned candidate has been materially affected.
It is needless to point out that failure on the part of the returned candidate to maintain
accounts as required by section 77(1) and (2) will in no case affect, and much less materially,
the result of the election. Where the main averment in the election petition was that
expenditure thereby incurred had not been included in the statement of accounts as
submitted to the District Election Officer as required under section 77 of the Act and Rules
86 and 90 of the Conduct of Election Rules 1961, the court held the candidate was not guilty
9 Dal ChandJainv. Narain Shanker Trivedi, 1969 DEC 129; Gajanan Krishnaji Bapatv: Dattaji Raghobaji Meghe, (1995) 5 SCC 347: AIR 1995 SC 2284.
21
of corrupt practice under section 123(6).10
EXPENDITURE MUST BE BY CANDIDATE OR HIS ELECTION AGENT
It is clear from section 123(6) and 77 that, in order to be a corrupt practice, the
excessive expenditure must be incurred or authorised by the candidate or his election
agent. An expenditure incurred by a third person which is not authorised by the candidate
or his election agent is not a corrupt practice. The Supreme Court held in Ramjaya Singhv.
Bed Nath Singh (1955) 1 SCR 671; AIR 1954 SC 749 : 10 ELR 129, that where the paid
employees of the father of the candidate worked at the election of the candidate, the
employees were mere "volunteers" qua the candidate and the payment to them by the
father could not be taken into account and consequently no corrupt practice was
committed.
Where a person interested in a candidate spent amounts to help the candidate in the
election, but the candidate himself had not authorised it and did not eventually meet such
expenditure, the candidate is not bound to include such expenditure in his return of
election expenses and would not be guilty of corrupt practice under section 123(6), if he
omits to include such expenses in his return. G. Vasanthapaiv. Srinivasan, 22 ELR 221.
To prove the corrupt practices of incurring expenditure beyond the prescribed limit, it
is not sufficient for the petitioner to prove merely that the expenditure of more than the
prescribed limit had been incurred in connection with the election, he must go further and
prove that the excess expenditure was incurred with the consent or under the authority of
the returned candidate or his election agent. Megh Raj Patoqia v. R.K. Birla, AIR 1971 SC
1295; the following cases were relied (upon, Ranan Jaya Singh v. Bay Nath Singh, AIR 1954
SC 749 = 1955 SCR 671; RamDayalv. Brijraj Singh, AIR 1970 SC 110; Mubarak Mazdoor v. Lai
Bahadur, 20 ELR 176.
In order to constitute a corrupt practice as contemplated by-sections 77 and 123(6), it is
necessary to plead requisite facts showing authorisation or undertaking of
reimbursement by the candidate or his election agent. Incurring or authorising expenditure