Manas Dasgupta
NEW DELHI, Mar 8: Inflicting a lethal blow to the Congress ahead of the Lok Sabha elections, the Income Tax Appellate Tribunal on Friday dismissed the party’s plea seeking a stay against the department’s action against the party’s bank accounts.
After the petition against the IT action was turned down, the Congress’ counsel, Vivek Tankha, appealed that the order be kept in abeyance for ten days for the party to appeal against the order in the high court but the tribunal bench declined it and said there was no such provision such provision or prayer before it. The party sources said the Congress would now file an appeal in the Delhi High Court.
On February 16, the Congress had said the Income Tax Department had frozen ₹ 115 crore in its bank accounts following a tax demand of ₹ 210 crore as dues and penalty for the financial year, 2018-19, which was also an election year.
Days later, Congress leader Ajay Maken had claimed that ₹ 65 crore had been withdrawn by the department from three of the party’s accounts even though a petition against the claim was being heard by the Income Tax Appellate Tribunal.
While there was no official statement from the I-T department on its action involving Congress bank accounts, official sources maintained “it was a routine process against anyone who has not paid income tax dues for years” and “The I-T department did exactly what it will do to an ordinary citizen if he or she fails to pay income tax dues.”
In February, the income tax department seized the party’s four main bank accounts on an income tax demand of ₹210 crore for 2018-19. The party approached the tribunal seeking a stay on the action of the income tax department and said the party won’t be able to pay bills and salaries if their accounts were frozen. Pending the hearing and the verdict in the case, the income tax department mandated banks to transfer over ₹65 crore from Congress, IYC and NSUI accounts to the government, Mr Maken said.
“Is it common for National Political Parties to pay Income Tax? No. Does the BJP pay Income Tax? No. Why then is the Congress Party facing an unprecedented demand of ₹210 crores?” Mr Maken wrote.
The allegation against Congress is that the party did not pay its income tax dues for the financial year 2017-18, the assessment year 2018-19. The initial dues were ₹103 crore and ₹32 crore in interest accrued on late payment. The dues were reassessed at ₹105 crore on July 6, 2021. The Congress then appealed before Commissioner Appeals but did not pay the mandatory 20% of the tax. As the case dragged on, the party made some payments but did not dispute the tax-due amount, income tax department sources said.
Repeating its charge that central agencies were being misused by the BJP, the Congress had called the tax demand “politically motivated” and said it was timed to disrupt the party’s election preparations. The Congress had also accused the BJP government of “financial terrorism” and attempting to “cripple” its primary opposition before the elections.
