Income Tax authorities are closely looking into data collected during raids in states, such as Madhya Pradesh, Karnataka, Andhra Pradesh and Gujarat, after it found that large cash payments were made to the Congress party, a report said. The tax department is seeking to finish the reassessment of accounts for the financial years 2013-14 to 2019-20 by March 31, 2024.
The move, which is based on information collected during raids on Megha Engineering, some entities linked to Karnataka Deputy CM D K Shivakumar and some individuals who were allegedly linked to a former Madhya Pradesh CM, has been challenged by Congress in Delhi HC. The matter came up for hearing on Tuesday, but the HC has reserved its order for now.
“We have told the court that we are in advanced stages of completing the assessment and we are awaiting the order, which is expected any day,” a source told The Times of India.
The source added that some of the searches had allegedly found links to cash payments in excess of Rs 100 crore. While tax authorities refused to give any assessment of the scale of demand that may be raised, the officers said the tax department was looking into the accounts of state units and other wings as they were all under the Indian National Congress umbrella.
The officers hinted that the grand old party may be at risk of tax exemption available to political parties for seven years in case the reassessment concludes it received individual contributions exceeding Rs 20,000, the threshold set under the law. The violation of the limit can attract punishment.
On its part, sources said Congress has maintained that ‘panchnama’ and other details were not shared with it. But denuing Tax authorities, however, said more than a dozen notices were issued in the cases which started a few years ago.
On Thursday, Congress MP Rahul Gandhi claimed that all accounts of the party have been frozen and that it cannot undertake any campaign ahead of the Lok Sabha elections.
The Congress, in February, had claimed that its bank accounts were frozen by the Income Tax department in connection with a dispute over a tax demand of Rs 210 crore. However, there has been no official statement from the I-T department.
“This is not freezing of Congress party's bank accounts, this is the freezing of Indian democracy,” Rahul Gandhi said. "As the biggest opposition party, we are unable to take any action - we can't book advertisements or send our leaders anywhere. This is an assault on democracy."
He added that due to the freezing of the party's bank accounts, the party was not being able to do campaign work. "20% of India votes for us, and we are not able to pay Rs 2 for anything. We can do no campaign work, we cannot support our workers, we cannot support our candidates... This has been done two months before the election campaign," he said.