In the run-up to the general elections, the Congress faces the threat of a financial choke which will constrain not only its campaign but even its day-to-day working. The party has claimed that the Income Tax (IT) Department has frozen its main bank accounts, making it unable even to pay salaries to its staff. The drastic action was reportedly taken by the authorities for late filing of its I-T returns for 2018-19.
The money drawn from the party’s national crowdfunding schemes were also frozen. It has approached the Income Tax Appellate Tribunal, which has allowed it to operate the accounts for the time being, on the condition that an amount of Rs 115 crore be kept in lien until the case is heard next week. The party has been allowed to spend funds over and above that, but it says it does not have such amounts in its current accounts.
The reason cited by the IT department does not seem to be genuine and the action is not a routine tax law enforcement activity. The Congress filed its tax returns for 2018-19, an election year, a few days late. There was also a discrepancy in tax receipts to the tune of Rs 14.4 lakh, which the party says was a cash contribution made by its MPs and MLAs.
The demand for a penalty of Rs 210 crore for the delay and the discrepancy is disproportionate, and cannot be justified on any grounds. Last week, the party’s Madhya Pradesh unit said some of its leaders had received notices in connection with an income tax raid conducted in Bhopal in April 2019. It also questioned the decision to summon them to Delhi instead of the local offices of the department, and said it was an attempt to intimidate the party.
The action against the Congress would only be seen as an attempt to disable the party before the elections. It is the country’s main Opposition party and to financially paralyse it before the election is to hijack the democratic process. It should be noted that the action against the Congress happened a day after the Supreme Court ruled that the NDA government’s electoral bonds scheme was unconstitutional.
The IT Department’s action would be seen as part of the government’s attempts to use the central investigative agencies and departments to harass and browbeat the Opposition and its leaders. It amounts to a virtual ban on electioneering. Holding an election after crippling and disabling the Opposition would be a farcical exercise and a negation of democracy.