Read Time: 04 minutes
The matter at hand revolved around the Tribunal's decision to deny the INC's request for a stay on the recovery of outstanding taxes for the assessment year 2018-19
The Delhi High Court has pronounced its judgment, dismissing the plea of the Indian National Congress Party (INC) that challenged the Income Tax Appellate Tribunal’s (Tribunal) order dismissing their request to halt the recovery proceedings initiated by the Income Tax Department for recovery of INR 135 Crores (including accrued interest).
The bench, consisting of Justice Yashwant Varma and Justice Purushaindra Kumar Kaurav noted that the party had been seeking adjournment since September 2023 and therefore ruled against intervening in the Tribunal decision, asserting there were no grounds to do so.
During the March 12hearing, the Bench expressed dissatisfaction with the Congress party's handling of the matter, noting that the demand for taxes dates back to 2021. Criticizing the party's apparent inaction, the bench remarked that someone within the Congress office seemed to have neglected the issue since 2021, leading to the present situation.
The IT department initiated proceedings against the Congress party in July 2021, disputing the party's declaration of nil income and requesting over ₹105 crore in taxes for the assessment year 2018-19. The demand was based on the late filing of the return and alleged receipt of donations exceeding ₹2,000 each, violating tax exemption provisions for political parties under Section 13A of the Income Tax Act.
Challenging the IT department's actions, the Congress approached the ITAT, arguing against the denial of tax exemption. However, in a ruling on March 8, 2024, the ITAT upheld the department's decision, finding no substantial grounds to support the Congress's claim.
Senior Advocate Vivek Tankha, representing the Congress, raised concerns about the freezing of the party's accounts, warning of dire consequences if the situation persisted, especially with the impending Lok Sabha elections. However, the bench remained unmoved, emphasizing that the issue had been ongoing since 2021 and could not be remedied by last-minute actions.
Meanwhile, the IT department's counsel, Zoheb Hossain, refuted claims of timing the proceedings close to the elections, arguing that the matter had been underway since 2021 and dismissing allegations of undue financial burden on the party.
Case Title: Indian National Congress v Deputy Commissioner Of Income Tax
Please Login or Register
