The Election Commission has warned that it will formulate tougher guidelines to prevent candidates from "overspending" in the forthcoming Assembly elections in five states.
"We are working on it and the guidelines will be ready by this week, much before the process is notified for elections in the five states," poll panel sources said.
They added that this was the first time such stringent measures would be imposed on the expenditure incurred by candidates.
While the notification for the elections in Mizoram will be issued on October 27, those for the other four states -- Delhi, Madhya Pradesh, Rajasthan and Chattisgarh -- will be issued on November 7.
Though the campaign budget of a candidate contesting Assembly polls has been capped at Rs 6,00,000, most end up spending much more and fudging expenditure limits by attributing it to heads of political parties, friends and relatives.
This means that a candidate with more resources will have a better chance of wining an election. Something that constitutes an unfair electoral practice. The EC wanted to plug this loophole, the sources said.
Chief Election Commissioner JM Lyngdoh had recently said in Jaipur that every contestant for the forthcoming Assembly polls would have to file a daily statement of expenditure incurred on electioneering.
A candidate who attributed expenses incurred by anyone on his behalf could be liable for disqualification, Lyngdoh said, adding that the EC would be very strict in this regard.
Declarations about assets and expenditure incurred on campaigning by a candidate would not be kept confidential and the income-tax department or any investigative agency could have access to it, the CEC had said.
A Bill, legalising corporate contributions to national political parties and tax breaks on political funding by individuals and corporate houses, is waiting to be passed by the Rajya Sabha.
The Lok Sabha has already passed the Bill. It envisages a more transparent contributions procedure for political parties.
Meanwhile, the EC will convene a meeting of about 500 observers, who will oversee the polls in the five states, on October 30. The sources said the observers would take positions around the time of filing of nominations.While nearly 135 observers were likely to be deployed in Madhya Pradesh, Rajasthan would have around 100, Chattisgarh 60-70 observers and Delhi and Mizoram around 20-25, the sources said.