Experts are intrigued by the new Income Tax Bill, 2025 retaining provisions related to electoral bonds, which were rendered unconstitutional by the Supreme Court last year, saying it could be because of legislative oversight or the government's intention to bring it back in some other form.

Electoral bonds have been mentioned in the new Income Tax Bill's Schedule VIII which deals with 'Income not to be included in the total income of political parties and electoral trusts'.

In a judgement passed on February 15 last year, the Supreme Court had scrapped the Centre's electoral bonds scheme of anonymous political funding, calling it "unconstitutional" as it was "violative" of the right to freedom of speech and expression and right to information.

Under the existing Income Tax Act, 1961, donations received from companies and individuals through electoral bonds are exempt in the hands of political parties.

The government has brought in a new Income Tax Bill to replace the 64-year old I-T Act. The 622-page Bill is a simplified version of the existing Act which has become complicated over the years because of over 4,000 amendments.

About the electoral bond related provisions in the new I-T Bill, AMRG and associates senior partner Rajat Mohan said the mention of electoral bond provisions in the new Income Tax Bill could be because of a legislative oversight, or a deliberate move to keep the door open for a modified version of the scheme in the future.

"While the Supreme Court had strong and justified grounds for striking down the scheme, the concerns it highlighted can be addressed through structured dialogue and expert consultations. The government still retains the legislative authority to reintroduce a revised political donation framework, provided it aligns with constitutional principles and ensures transparency in electoral funding," he said.

Mohan said mentioning of the electoral bond in the new Bill may be a strategic decision by policymakers to leave room for future electoral financing reforms.

Shardul Amarchand Mangaldas and Co Partner Rohit Garg said the changes in the new income tax bill are merely structural in nature. There have been no major changes in the substantive provisions and the charging sections. Every provision which was not rendered obsolete has been carried forward into the new Act.