Recovery of Rs 135 cr from Congress as per provisions of Income Tax Act: Sources
Congress lost income tax exemption in 2018-19 due to extensive use of cash in the electoral process, sources said, justifying that Rs 135 crore tax recovery from the party was consistent with the provisions of the Income Tax Act. Based on incriminating material seized by the Income Tax Department during search operations, specifically in April 2019, reflecting extensive use of cash in the electoral process, assessments of the party were reopened for seven years (AY 2014-15 to AY 2020-21), sources said.
Following the assessment, demand was raised in 2021, and communications to pay demand were sent many times, they said, adding that stay applications filed by the assessee were rejected during the proceedings.
Subsequently, even after 33 months of the assessment order and 10 months of the Commissioner Income Tax (Appeal) order, when the assessee had not complied with the demand raised, recovery proceedings under Section 226(3) of the Act were undertaken, sources said.
As a result, recovery proceedings to an extent of around Rs 135 crore of outstanding demand were initiated as per provisions of the Act, as the plea for stay was rejected by the Income Tax Appellate Tribunal (ITAT) and Delhi High Court.
Accordingly, recovery of Rs 135 crore has been made as per provisions of the IT Act, 1961, sources said.
However, the recovery process has not gone down well with the principal opposition party, as Congress has termed the action by the Department as «tax terrorism».
Congress president Mallikarjun Kharge accused the
