Income Tax Department, days after issuing notice to Congress raising demand of RS. 3,500 Crore, assured Supreme Court not to take any coercive step to recover the amount at it did not want to cause any problem for the party during elections.
Appearing for the I-T dept after Delhi High Court order refusing to put stay on the department’s tax notices worth crores to Congress, Solicitor General Tushar Mehta told a bench of justices B V Nagarathna and Augustine George Masih that he wanted to file a petition on behalf of the I-T Department.
He said that no further action will be taken against the opposition party during the ongoing general elections. He said the case may be transferred for hearing after June 4, when the Lok Sabha election would be declared. He said he would oppose Congress’s claim then.
“Since elections are on, we do not want to create any problem for the party. We will not take action for recovery of the amount and these could be heard in the second week of June,” he told the bench.
Delhi HC order that ended the tax exemption for parties
The Income tax notice comes after the authorities had ended the tax exemption available to political parties and had taxed the party for gross receipt based on a Delhi High Court order of March 2016. The appeal was filed by congress in 2018 against the HC order but in vain.
Congress grateful after the judgement
Initially, Mehta said notices were issued to recover Rs 1,700 crore, but senior advocate Abhishek Manu Singhvi said the total was around Rs. 3,500 crore, which the SG accepted. Singhvi appreciated the I-T department for its friendly attitude. The court took cognizance of the stand of the I-T department; the case is now listed for next hearing on July 24.
Solicitor General Tushar Mehta said that recent appeal was not related to the recent tax notices issued to Congress, I-T department has decided to defer coercive steps in view of impending elections.
Congress’ allegations
I-T department’s stand comes following protests from Congress which alleged that its accounts were frozen – a charge the I-T has department has denied – as part of BJP’s conspiracy to rig elections by financially crippling the opponent. The I-T department has justified its move to recover tax arrears and interest by citing Congress’s failure to file returns and not following the appeal process. It pressed on with its claim after Delhi high court did not entertain Congress’s challenge.
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