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What is forcefully pointed out by Mr. Gokhale is that nothing could be more corruptive in a democracy than to permit industrial or commercial concerns to contribute funds to a political party. It is nothing short of buying over the party so that the party should pursue a policy which would be in the interests of the commercial and industrial concerns which make contributions to the political parties. Mr. Gokhale says that if this was permissible it would be impossible to get a party which is elected to power with the help of such financial aid to determine upon policies in the interests of the country, in the interests of socialism, or in the interests of democracy....Now, before we deal with the legal aspect, it may be pointed out in fairness to the company that it has made the position clear that the Congress has already come to a particular decision as to policy and contribution that is sought to be made is not to influence or mould that policy but to keep in power a party which having already laid down its policy, that policy is being looked'. upon by the company as conducive to its interests. We must confess that we realise the danger--and the grave danger--of the line between these two positions being overlooked or obliterated. The line is so thin that it is easy to step from one side of the line to the other......But that brings us to the real question before us. Is there anything today in India, as the law stands, which prohibits any contribution being made to the political funds of a party by any individual, institution or organization ? We asked Mr, Gokhale to draw our attention to any such law in force in our country today and he very frankly and fairly conceded that there was no such law......

27. The third decision on which he relied was a Madras decision In re Sri Natesar Spinning and Weaving Mills Private Limited, [1966] 30 Comp. Cas. 54 in which case, dealing with a similar application, Ramaswami J. observed :

" Modern democracies require for its successful working stable political parties and stable parties require, whether they are in or out of the Government, a costly machinery for strengthening and intensifying its hold on the electorate. This calls for legitimate unceasing expenditure of funds for the maintenance and widening of party's organisation and activities. The time when leaders in democracies were men of substance and could dispense with any extraneous aid for funds is a thing of the past. The present leaders in all democratic countries most often come up from scratch. The methods of appealing to the masses and the necessary contacts which have to be maintained with the masses are now far more intensified and require a continuous supply of funds.
It is better on the balance that these funds should come from regular sources. The Labour Party in England is sustained and nourished by the regular levies made by the wealthy and powerful and ubiquitous trade unions, rather than degenerate into secret funds collected by all questionable methods. It is enough to recall how the late Mr. Lloyd George recruited funds for the Liberal Party upon sale of honours which necessitated drastic changes in the procedure for the conferment of honours in England. In America party funds are being collected by bizarre methods like holding dinners at 200 or 300 dollars a plate. In other countries where democracies are less advanced and more corrupt party funds are collected by sale of favours, permits, offices, etc. Therefore, on the balance, this becomes only a choice of evils and it is far better that political parties should depend upon regular sources, under Section 293 of the Indian Companies Act, than degenerate into adopting corrupt methods for securing funds. The price of democracy is the maintenance of stable political parties and the price of stable political parties is the existence of regular sources of subvention."

30. Lastly, in the case of Sree Meenakshi Mills Ltd. v. Commissioner of Income-tax, the Supreme Court went a step forward and observed :

" Expenditure incurred not with a view to the direct and immediate benefit for purposes of commercial expediency and in order indirectly to facilitate the carrying on of the business is, therefore, expenditure laid out wholly and exclusively for the purposes of the trade. "

31. The expression " commercial expediency" is not a term of art. It means everything that serves to promote commerce and includes every means suitable to that end. It may be, as some believe, that if virtue be hazarded on the perilous cost of expediency, the pillars of democracy however apparent in their stability, are infected at the very centre. But it is for democracies to guard against such hazards and ban expediencies, which are unethical or sinful, as matters of public policy. So long as certain means of commercial expediency be not declared to be unlawful, nothing prevents recourse to such expediencies, if they facilitate trade or commerce even indirectly.