Sources in the income tax department told News18 on Friday that the “recovery” of Rs 115 crore from various bank accounts of the Congress party was a “routine matter” and operations or activities in the party’s accounts had not stopped.

Congress treasurer Ajay Maken earlier in the day claimed that the income tax department had frozen the party’s main bank account on “flimp reasons”, adding that the action affected All the party’s political activities in the two weeks before the general election is announced.

The party was not even able to use funds received through the crowdfunding scheme, Marken told a news conference, adding that four main bank accounts were frozen. Maken said accounts, including those of the Indian Youth Congress, were frozen due to income tax demand of up to Rs 210 crore for the election year 2018-19.

According to him, the party filed its income tax returns for the years in question a few days late and that was the reason for the action. The IT authorities issued orders to freeze the accounts on Wednesday, he said.

However, sources in the IT department said the action was routine.

“The demand of Rs 135 crore of the Indian National Congress (INC) for the assessment year 2018-19 is yet to be fulfilled. This includes a demand of Rs 103 crore, along with interest of Rs 32 crore (approximately),” an official said.

“In the present case, assessment u/s 143(3) of the Income Tax Act, 1961 was completed on June 7, 2021 and exemption u/s 13A was not allowed as the provisions of section 13A(d) were not complied with, And the tax return income was also late. The income when the assessment was completed was Rs 199 crore and created a tax demand of Rs 105 crore,” he added.

“Thereafter, in the stay proceedings of the AO, the company was asked to pay 20 per cent of the total demand (i.e. approximately Rs 21 crore) as per the existing procedure. Only Rs 78 lakh was paid. As INC failed to pay 20 per cent of the outstanding demand, A letter was issued asking it to pay the balance demand of Rs 104 crore. The appeal filed by INC before the CIT(A) was later dismissed.”

“The second appeal was filed by INC before ITAT (Income Tax Appellate Tribunal) in May 2023. Although no petition for stay was filed before ITAT or any other judicial authority, INC subsequently paid Rs 172 crore in October, 2023. So far, Rs 115 crore has been recovered through withdrawal of funds from various bank accounts of INC. In a suit filed with ITAT on February 16, 2024, the Income Tax Department informed that withdrawal of funds from accounts is a routine recovery measures,” the source further said.

The source added that operations or activity on the account have not been halted. “In addition, INC has further accounts regarding its activities, a fact that has been brought to the attention of ITAT. A hearing is now scheduled for February 21, 2024.”

However, Congress leader Ajay Maken disputed the claim that the accounts had been unfrozen.

“In our petition, the Income Tax Department and the Income Tax Appellate Tribunal (ITAT) said that we have to ensure that Rs 115 crore is deposited in the bank. This Rs 115 crore is a lien marked in the bank account. This means that Rs 115 crore has been Frozen. The Rs 115 crore is much more than the amount in our current account,” he posted on X.