For electoral bonds, SBI billed govt Rs 10.68 crore as ‘commission’

The transaction and bank charges were levied for each of the 30 phases of the sale and redemption of electoral bonds from 2018 to 2024. The SBI billed the Finance Ministry a total of Rs10.68 crore as “commission” owed, from the start of the scheme.

The charges varied — the lowest was Rs 1.82 lakh for the fourth phase of the scheme when 82 bonds were redeemed, while the highest was Rs 1.25 crore for the ninth phase when 4,607 bonds were sold ahead of the 2019 Lok Sabha elections.

The bank had to routinely send reminders to the ministry for payment of dues. In one instance, then SBI Chairman Rajnish Kumar even wrote a letter, dated February 13, 2019, to then Economic Affairs Secretary S C Garg. At that stage, SBI’s unpaid dues for seven phases of the scheme added up to Rs 77.43 lakh.

In this communication, the SBI Chairman noted how the commission was being calculated. He wrote: “The claim for commission lodged by the bank is considered very reasonable, keeping in view the complexities associated with the related IT developments… The claim is also in line with government commission rates. Collections: Rs 50 per transaction for physical collections and Rs 12 per transaction for online transactions. Payments: 5.5 paise per Rs 100…”

While the SBI had argued that 18% GST on the commission should also be paid to it, the bank faulted the ministry for levying 2% TDS on the GST on one occasion. In an email dated June 11, 2020, the SBI sought “immediate” refund of Rs 6.95 lakh which had been deducted as TDS on GST from the Rs 3.12 crore commission paid to it for some phases of bond sales.

The SBI also listed the quantum and value of unredeemed electoral bonds — which were sent to the Prime Minister’s Relief Fund (PMRF) — for each phase. The amounts deposited in the PMRF varied – Rs 10 crore for Phase 3; Rs 3 crore for Phase 10; Rs 5 lakh for Phase 27; Rs 1.75 crore for Phase 30.

On at least one occasion, the bank alerted the ministry on “erroneous printing of electoral bonds”. In a letter dated March 23, 2021, the SBI noted how “one of the authorised branches has reported that they have received 94 electoral bonds of different denominations where bond serial number is printed over the hidden serial number and visible with naked eye”.

The hidden serial number, as per the security features introduced for the scheme, was supposed to be visible only under ultra violet (UV) light. The “damaged” bonds, printed at the security press in Nashik, should not be in circulation, the bank said.

Also, ahead of the 2019 Lok Sabha elections, the SBI told the Finance Ministry that the demand for electoral bonds was expected to see a sharp increase. “In view of the ensuing general elections in 2019 and Assembly elections in various states, the existing stock of EBs will need to be supplemented…we observe that EBs in TL (Ten Lakh) and OC (One Crore) series accounted for maximum sales. We are of the view that the same trend will continue,” the bank said in a note to the Joint Secretary (Budget) before the 2019 elections, after the sixth phase of sale of electoral bonds.

Earlier this year too, just five weeks before the Supreme Court junked the scheme in February, the SBI pitched for printing Rs 10,000 crore bonds, in its letter dated January 8, 2024. “In view of ensuing general and Assembly elections in various states to be held this year, we expect an increase in demand for EBs during this period. There is therefore an immediate need for printing of more EBs in order to meet the demand,” the bank said.