Recovery of Rs 135 crore from Congress under Income Tax Act: Report

New Delhi:

Sources said the Congress party lost income tax exemption in 2018-19 due to heavy use of cash during the election process and certified that the Rs 135 crore tax recovered by the party was in compliance with the provisions of the Income Tax Act.

The assessment of the party was reopened for seven years (2014-15 to 2020-21) based on incriminating material seized by the Income Tax Department during raids, particularly in April 2019, reflecting heavy use of cash in the election process. , sources said.

After the assessment, the demand was made in 2021 and multiple letters demanding payment were issued, they said, adding that the stay application filed by the assessee was rejected during the proceedings.

Subsequently, sources said that even 33 months after the issuance of the assessment order and 10 months after the order of the Commissioner of Income Tax (Appeals), when the assessee failed to comply with the requirements imposed, a case was initiated under Section 226(3) of the Act Recovery proceedings. .

Accordingly, as the Income Tax Appellate Tribunal (ITAT) and the Delhi High Court dismissed the stay petition, recovery proceedings for outstanding demand of approximately Rs 135 crore were initiated under the provisions of the Act.

As a result, Rs 135 crore has been recovered under the provisions of the IT Act, 1961, sources said.

However, the recovery process has not been welcomed by the main opposition party, with Congress calling the department’s actions “tax terrorism”.

Congress president Mallikarjun Kharge on Friday accused the BJP-led Center of misusing agencies like the Income Tax department, ED and CBI to subvert democracy and belittle the Constitution and asked why the IT department was being used to harass the main opposition Party of weapons.

Congress leader Rahul Gandhi also lashed out at the BJP, accusing it of indulging in “tax terrorism”.

However, sources said the tax department took this action as the Congress did not get a reprieve from ITAT and the Delhi High Court in the matter.

They pointed out that the Congress was given ample opportunity to reply, especially with regard to the various observations of the Delhi High Court, and the department had completed its seven-year assessment after considering all the replies submitted by the party.

In another matter related to the assessment year 1994-95, sources said the department’s demand of Rs 53 crore is pending before the Supreme Court.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)