ITAT dismisses Congress plea, upholds tax demand of ₹199.15 crore
What's the story
The Income Tax Appellate Tribunal (ITAT) has dismissed an appeal by the Indian National Congress, upholding a tax demand of ₹199.15 crore. The party had sought exemption under Section 13A of the Income Tax Act for the assessment year 2018-19. However, the ITAT rejected this plea due to the late filing of income tax returns and the violation of cash donation limits.
Filing issues
Late filing of income tax return
The Congress filed its income tax return on February 2, 2019, well past the due date of December 31, 2018. The party had declared nil income in this return. However, during scrutiny in September 2019, the Assessing Officer found that the party had accepted cash donations of ₹14.49 lakh, many of the donations exceeding the ₹2,000 per donor limit under the law.
Tax upheld
IT department and appellate tribunal uphold tax demand
The Income Tax department levied tax on the entire amount after denying the exemption claim in 2021. The Commissioner of Income Tax (Appeals) also upheld this decision in March 2023. Moreover, the Appellate Tribunal, which the Congress party approached for relief, had refused to grant any interim relief last year.