Monday, July 18, 2011

Non Submission of Income Tax Returns by 300 Political Parties

       A country-wide probe conducted by the Income Tax (I-T) department has found that close to 300 registered political parties have never filed their tax returns and the Election Commission has now asked the department to issue notices to them.

        The probe, conducted after the EC asked the Central Board of Direct Taxes (CBDT) to ascertain the financial status of these small parties for alleged violation of tax laws and money laundering, has been submitted to the election panel.

         A number of parties also do not possess permanent account number (PAN), the bulky report, prepared by the assessment wing of the CBDT, said.

        The EC had sent a list of suspect political parties to CBDT for probe early this year. It was alleged that people are floating such political parties in large numbers to evade taxes as donations to them are exempt from payment of income tax.

       The EC has asked the department to intensify the probe and serve show-cause notices to these small parties under relevant sections of I-T Act and ascertain the source and end use of the funds they received.

       The report has tracked the I-T returns of these small parties in 13 states including Tamil Nadu, West Bengal and those from the North East.

        "The status of such small parties in the remaining states will also be sent to the EC soon," a senior officer involved in the exercise said.

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