Latest news with #ITAT
New Indian Express
a day ago
- Business
- New Indian Express
Income tax tribunal upholds Rs 199 crore tax demand against Congress
In a setback to Indian National Congress (INC), the Income Tax Appellate Tribunal (ITAT), Delhi Bench, which upheld a tax assessment of over Rs 199 crore for Assessment Year 2018-19. The Tribunal confirmed the disallowance of tax exemption under Section 13A of the Income-tax Act, 1961, citing the party's failure to file its income tax return by the due date and the receipt of cash donations exceeding the prescribed limit. The case originated when the Deputy Commissioner of Income Tax, Central Circle-19, assessed the INC's income at Rs 199 crore, despite the party declaring "Nil" income. This assessment was subsequently upheld by the Commissioner of Income Tax (Appeals). A key contention was the timing of the INC's tax return. For Assessment Year 2018-19, the due date for filing income tax returns for political parties was initially September 30, 2018, later extended to December 31, 2018. However, the Indian National Congress filed its return on February 2, 2019, which the tax authorities deemed to be beyond the prescribed due date under Section 139(4B) of the Act. Section 13A's second proviso specifically mandates that a political party must furnish its return of income by the due date under Section 139(4B) to avail tax exemption. The second major point of contention was the receipt of cash donations. The Assessing Officer found that the INC had received Rs 14.49 lakh in cash from various persons, with each donation exceeding Rs 2,000. Section 13A(d) of the Act strictly prohibits political parties from receiving donations exceeding Rs 2,000 in cash, mandating transactions through account payee cheque, bank draft, electronic clearing system, or electoral bond. The tax department argued that the party's own balance sheet recorded these as "donations". The INC argued that its return, filed on February 2, 2019, was within the extended time limit available under Section 139(4) of the Act, and that a belated return should not lead to the disallowance of exemption under Section 13A. The party also attempted to differentiate between "voluntary contributions" and "donations," stating that the cash receipts were voluntary contributions and not donations, an argument rejected by the tax authorities. However, the ITAT's order sided with the revenue department, reinforcing the strict compliance required by political parties to claim tax exemptions under Section 13A. The tribunal's decision underlines the importance of adhering to both timely filing requirements and the prescribed modes for receiving donations to qualify for tax exemptions. The appeal of the Indian National Congress was dismissed, confirming the disallowance of the claimed Rs 199.15 crore exemption.
Time of India
a day ago
- Politics
- Time of India
ITAT rejects Congress appeal against tax demand of Rs 199 cr
The Income Tax Appellate Tribunal (ITAT) Monday dismissed an appeal filed by Congress challenging a tax demand of ₹199.15 crore for assessment year 2018-19. The tribunal rejected the party's claim for tax exemption under Section 13A due to late return filing and violations of cash donation limits, establishing strict compliance requirements for political parties seeking tax benefits. "All these assessee's (Congress) vehement submissions fail to evoke our concurrence," ruled the quorum of judicial member Satbeer Singh Godara and accountant member M Balaganesh. Referring to a leading Supreme Court judgment and a March 2016 high court ruling, the tribunal in its July 21 ruling held that an exemption mentioned in a tax statute must be "strictly complied with". The 50 page ITAT order referring to the two rulings (SC and HC) said "this is for the precise reason that so far as an interpretation of such an exemption provision in a fiscal statute is concerned", not only the high court has made it clear "that Section 13A has to be strictly complied with" but also the Supreme Court in a 2018 ruling "has settled the issue that it is not liberal but stricter interpretation only in a taxing statute which has to be employed in an exemption claim". Live Events Dismissing Congress's appeal, the tribunal held "that being the case and in light of the fact that even Section 139(4B) has stipulated filing of return within the 'due' date i.e. required to be furnished u/s 139(1), we are of the considered view that the above former clause in fact restricts any further liberalism herein as clearly incorporating the expression of 'due' date". "Therefore, the moment there is violation of such a 'due' date, Section 13A third proviso gets attracted, so as to result in denial of exemption to the party concerned," the order said.
News18
a day ago
- Business
- News18
Congress Denied Tax Exemption Of Rs 199.15 Crore, Tribunal Cites Lapses, Donor Rule Violations
Last Updated: The Income Tax Appellate Tribunal rejected the argument that late returns should be treated like charitable trusts, stressing political parties must strictly file within deadline In a significant legal setback for the Congress, its tax exemption claim for Rs 199.15 crore was denied due to procedural lapses and violation of donation rules. The Income Tax Appellate Tribunal (ITAT) on Tuesday dismissed the appeal made by the Congress and upheld an income‑tax demand of Rs 199.15 crore. It also rejected the party's argument that late returns should be treated like charitable trusts under Section 12A, stressing that political parties must strictly file within the statutory deadline. The ITAT found that the Congress violated two critical conditions under Section 13A, which governs tax exemptions for political parties. It noted that the Congress filed its income tax return on February 2, 2019, missing the mandatory extended deadline of December 31, 2018, as specified under Section 139(4B). The Congress received cash contributions of a total of Rs 14.49 lakh from various donors, with individual donations exceeding the permissible limit of Rs 2,000 under Section 13A provisions. While the party provided donor names and PAN details – mostly from its own elected MLAs and MPs – the tribunal ruled that the cash payment method itself violated the law. The bench, comprising judicial member Satbeer Singh Godara and accountant member M Balaganesh, stated that Section 13A represents a special exemption that must be applied with strict adherence to all conditions, with any breach rendering the entire exemption invalid. The tribunal dismissed an attempt by the Congress to distinguish between 'voluntary contributions" and 'donations," noting that the party itself made no such differentiation in its records or Election Commission filings. Additionally, the ITAT rejected the party's plea that only surplus funds after expenses should be taxed, instead ruling that once Section 13A exemption is denied, all voluntary contributions become taxable income. Beyond the primary tax demand, the tribunal also upheld additional financial penalties including interest charges under sections 234A, 234B, and 234C totaling over R 35 crore, plus a Rs 10,000 fee under Section 234F for delayed filing. This brings the total financial liability to approximately Rs 234 crore, representing a substantial burden for the opposition party. The Congress had previously appealed to the CIT (appeals) but was unsuccessful, with that appeal being dismissed in March 2023. (With ANI inputs) view comments First Published: Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
India Today
a day ago
- Business
- India Today
Why did Jagdeep Dhankhar resign and who will be the next Vice President?
5:21 Congress faces a significant financial setback after the Income Tax Appellate Tribunal (ITAT) dismissed its appeal against a tax demand for the assessment year 2017-18. The case involves an income of over Rs 199 crore, which the Congress party claimed was exempt from tax as it constituted donations.
Indian Express
a day ago
- Business
- Indian Express
Income Tax Appellate Tribunal dismisses Congress appeal against Rs 199 crore tax assessment
Denying relief to the Indian National Congress, the Income Tax Appellate Tribunal (ITAT) on Monday dismissed an appeal by the party against a tax demand of ₹199.15 crore for the year 2018-19. Late return filing and violations of cash donation limits were among the main grounds due to which the ITAT rejected the party's claim for tax exemption. 'The assessee's return filed on 02.02.2019 is not within the 'due' date to make it eligible for the impugned exemption,' ruled the coram on July 21. The INC had filed its income tax return on February 2, 2019 – over a month after the extended due date of December 31, 2018, prescribed under the IT Act. It had declared income after claiming an exemption of Rs. 199.15 crores. Another issue that the ITAT looked at was a violation of cash donation limits. According to scrutiny proceedings, the party had received ₹14.49 lakh in cash donations exceeding ₹2,000 from various individuals. Donations above ₹ 2,000 can only be received through banking channels like account payee cheques or electronic transfers as per the Finance Act, 2017. 'As per section 13A(d) of the Act, donation in excess of ₹2,000/- is mandatorily be received through a/c payee cheque/draft or through electronic mode and therefore donation in excess of ₹2,000/- received in cash violates provisions of clause (d) of first proviso to section 13A of the Act,' the ITAT order stated. The Congress tried to find respite in Section 139(4) of the IT Act which states that if an individual misses the ITR filing deadline, they can still file a belated return, subject to penalties. The ITAT, however, denied it relief. '…it is manifestly clear that the legislature has incorporated the statutory expression therein as 'within the time allowed under that section' i.e. section 139(1) as well as u/s 139(4)…we thus reject the assessee's instant first and foremost substantive grievance in very terms and decide the above first question framed between the parties; in the department's favour,' the tribunal ruled.
