Following the news reports that no scrutiny will be done in case of Income-tax returns filed by the registered political parties in the context of deposits of old currency notes, the CBDT today clarified that the Income Tax Act have enough provisions to scrutinize the accounts of political parties.
The press release issued by the Board today states that “There have been some newspaper reports which seem to wrongly suggest that there cannot be any scrutiny of Income-tax returns of political parties registered with the Election Commission in the context of deposits of old currency notes. This inference seems to have been drawn because of the fact that the income of the political parties is exempt from Income – Tax under Section 13A of the Income Act.”
It was further clarified that the exemption is subject to conditions specified in s. 13A of the Income Tax Act. “There are enough provisions in the Income Tax Act to scrutinise the accounts of the political parties and these political parties are also subject to other provisions of Income -tax including filing of return.”
Earlier there were reports suggesting that the Government said that political parties depositing old 500 and 1,000 rupee notes in their accounts will be exempt from income tax provided the donations taken are below Rs 20,000 per individual and properly documented.
