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Report No. 170 Article 7 deals with the organisation of political parties both at the national and regional level. Article 8 provides that the members' meeting and the executive committee shall constitute the essential organs of the party and its regional organisations and for other allied matters. Article 9 provides for constitution of members' assemblies and delegates assemblies and the rights of the members in that behalf. Article 10 empowers the political parties to decide on the admission of new members. It says that no justification need be given for refusing an application for membership. It further declares that members of the party and the representatives in the party bodies have equal voting rights. The party can frame statutes providing for disciplinary action against members and other matters specified therein. Article 11 provides that every political party shall elect an executive committee at least every second calender year and that the committee must consist of at least three members. It also deals with the powers of the executive committee and its duties. Article 12 provides for constitution of general party committees and other incidental matters. Article 13 provides for composition of delegates' assemblies. Article 14 provides for arbitration in case of a dispute between the members or between the party and members or between the party ad regional organisations, as the case may be. Article 15 deals with the process of decision-making in party organs. It reads thus:

"Article 15. Decision-Making in Party Organs.-(1) The party organs adopt their resolutions on the basis of a simple majority vote inasmuch as a higher majority vote is not stipulated by law or by the statutes.

(2) The ballots for members of the executive committee and representatives to delegates' assemblies as well as to the bodies of higher level regional organisations are secret. Voting at other elections is not secret unless voters object when asked to confirm such procedure.

(3) The statutory provisions governing the submission of motions must be such as to ensure the democratic forming of opinions and in particular adequate discussion of the proposals put forward by minorities. At the delegates' assemblies of higher level regional organisations, at least the representatives of the regional organisations at the next two lower levels must be granted the right to introduce motions. No commitment to the resolutions of other bodies is permissible at elections and polls." Article 16 deals with dissolution and/or termination of the subordinate regional organisations. Section III contains only one article, namely, article 17. It says that "candidates for election to Parliament must be chosen by secret ballot. The nomination procedure is governed by the election laws and the party statutes." Section IV containing articles 18 to 22 deals with public financing of political parties whereas Section V obliges the political parties to maintain and publish their accounts regularly. Article 23 needs to be set out in full:

"Article 23. Statutory obligation to Publish Accounts.-(1) The executive committee of the party shall make a public statement of the origins and the use of funds received by its party within a calendar year (accounting year) as well as of the assets of the party in a statement of accounts.

(2) The statement of accounts must be scrutinised by a certified auditor or auditing company in accordance with articles 29 to 31. In the case of parties who do not meet the requirements of article 18, para 4, first sentence, the statement of accounts may be scrutinised by a chartered accountant. It must be submitted by 30 September of the year following the accounting year to the President of the German Bundestag and be circulated by the latter as a Bundestag paper. The President of the German Bundestag can extend the limit by up to a maximum of three months in extenuating circumstances. The party statement of accounts shall be submitted for discussion to the federal party convention following its publication.

(3) The President of the German Bundestag shall examine whether the statement of accounts is in accordance with the regulations of Section V. The result of the scrutiny shall be recorded in the report in accordance with para 5.

(4) The President of the German Bundestag may not determine a party's allocation of public funds under articles 18 and 19 so long as a statement of accounts in accordance with the provisions of Section V is still outstanding. Payments under article 18 shall be based on the statement of accounts to be submitted for the preceding year, payments under article 20 on the statement of accounts submitted for the preceding year. If a party fails to submit the report by 31 December of the following year it shall forfeit its claim to public funds: allocations and disbursements to the other parties shall remain unaffected.

(5) The President of the German Bundestag shall submit annually to the German Bundestag a report on the state of party finances and on the statements of accounts of the parties. The report shall be circulated as a Bundestag paper." Article 23(a) prohibits the political parties from obtaining donations illegally. It also provides that in case the political party fails to publish the statement of accounts as provided by article 25(2), it shall forfeit public funding in an amount double the amount illegally obtained or not published in accordance with article 25(2). It also sets out the meaning of 'illegal donations'. Article 24 specifies what should the statement of income and expenditure contain. It mentions the several items which must necessarily be included and shown in such a statement. Broadly speaking it must disclose full particulars in the specified form, of income received, sources from which received, expenditure incurred on various items and its net assets. Article 25 deals with donations to political parties. It says that political parties are entitled to accept donations except from the sources specified therein. The sources which are so excluded are political foundations and parliamentary groups, corporate bodies, religious and charitable associations of persons and so on. Article 26 defines the expression "income". Article 28 creates a statutory obligation upon the political parties to "keep books in respect of their accountable income and expenditure and of their assets". The article further provides that the accounts "shall be kept in accordance with the principles of orderly accounting and with regard for the purpose of the present law. Accounts shall be preserved for five years..." Article 29 provides for auditing of the statement of accounts while article 30 makes it obligatory that the statement of accounts shall contain an audit certificate in the prescribed manner. Article 31 deals with the appointment of auditors. Sections VI and VII deal with implementation of bans on unconstitutional parties and final provisions, which are not relevant for our purpose and need not be referred to.

1.4.2. Though our Constitution was also framed between the years 1946 to 1949 (i.e., approximately at the same time when the German Constitution was drawn), it is rather inexplicable why our Constituent Assembly did not think it appropriate to make provisions governing the political parties on the lines contained in the German Constitution.

It may be mentioned even at this stage that though this aspect did not figure in the suggestions contained in the working paper prepared by the Law Commission in September 1998 and circulated among the political parties and the members of the public, the same has assumed considerable significance in the course of debate at the several seminars held by the Law Commission in this behalf and has also been suggested in several responses received by the Law Commission in response to the working paper.

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