Congress gets tons of cash, plenty of time to respond: Tax sources

Congress leaders say the party is being targeted.

New Delhi:

Allegations of “tax terrorism” raised by the Congress under a new notification from the Income Tax Department have been strongly countered by sources in government agencies who pointed out that incriminating material has been seized and the assessment process is on as they will have passed by March 31 this year aging.

Sources said the Congress party was aware of the proceedings and was given ample time to respond, including at a hearing in the Delhi High Court, which rejected the party’s relief.

Congress had earlier claimed that its bank accounts had been frozen after the income tax authorities imposed a penalty of Rs 200 crore, but on Friday said it had received fresh tax notices from the tax department for Rs 1,800 crore.

The new notification is applicable for the assessment years 2017-18 to 2020-21 (financial years 2016-17 to 2019-20) and includes penalty and interest.

Officials said an income tax probe in April 2019 revealed that Congress received cash receipts from companies such as Megha Engineering, which has emerged as the second-largest donor to the electoral bonds scheme. They claimed that this was discovered during a raid on an aide of Congress leader and former Madhya Pradesh chief minister Kamal Nath.

Officials said cash receipts totaled Rs 626 crore between 2013-14 and April 2019, including lawsuits over alleged corruption scams.

“The cash receipts were identified and corroborated through various means, including documents, WhatsApp messages and recorded statements found during the searches,” an official said.

Under Section 13A of the Income Tax Act, payments received by political parties are tax-free provided certain conditions are met, including not accepting an amount exceeding Rs. 2,000. Because Congress violated those conditions, it was liable to pay taxes on all of its income, officials said.

“The Congress was able to stay the execution because the income tax department had produced detailed and conclusive evidence on record in court. If the Congress feels it is innocent, it should release the entire assessment order to the tax department. The public and the truth will be revealed,” a source said.

The Delhi High Court on Thursday dismissed four petitions filed by the Congress against the income tax reassessment process initiated by it for the assessment year 2017-18 to 2020-21.

“become a target”

Congress on Saturday said that apart from the Rs 1,800-crore tax notice, its leaders have also received two other tax notices. Youth Congress workers also staged protests in Delhi against what the party called “tax terrorism” by the BJP-led central government.

“Congress is being targeted and we keep getting notifications. Friday night we got two more notifications. Yesterday when we had the press conference we got four notifications and then we got two more notifications. I don’t know there will be more. How many notices have been sent,” senior Congress leader Jairam Ramesh said on Saturday.

Karnataka Deputy Chief Minister DK Shivakumar said the notifications proved that the BJP was “fearful” of the Congress and the Union of India. “BJP knows they are going to lose the election, so they are trying to create all sorts of fears. I also received an income tax notice last night on a resolved issue,” he claimed.