The Congress on Friday said that all its bank accounts had been frozen by the Income Tax (IT) department over a discrepancy in filing its 2018-19 tax returns, terming the action an “assault on democracy by the Narendra Modi government” in the run-up to the Lok Sabha election.
The Income Tax Appellate Tribunal (ITAT) subsequently provided partial relief by allowing the party to operate its account after setting aside ₹115 crore in lien. “This means that ₹115 crore has been frozen. This amount is much more than we have in our Current Accounts,” Congress treasurer Ajay Maken said.
According to ITAT’s Friday order, the Revenue department told the tribunal that it had not issued any orders “for freezing the transactions in the bank account(s), but only for a lien on the amount lying in the bank account(s) upto the outstanding tax demand”. In a post on X, Mr. Maken shared copies of the notices sent to bank branch managers holding them personally liable for ensuring the payment of the Congress’ dues, and asked, “Is this not attaching/ seizing / freezing our accounts?”
The Congress said that 11 bank accounts were frozen in all, including two accounts of the Indian Youth Congress (IYC). Mr. Maken said that the accounts were frozen due to an Income Tax department demand of ₹210 crore for the assessment year 2018-19, and a dispute regarding cash receipts of ₹14.4 lakh given to the party by its MLAs and MPs as donations from their salaries.
Late filing
The party learnt of the IT department’s action on Wednesday, when banks refused to honour cheque payments. “You all know that 2019 was an election year and the deadline to file returns was extended upto December 31, 2019. We were late in filing our returns only by 40 to 45 days,” he said.
The Congress’ appeal to release the hold on its accounts will be heard by the ITAT on February 21, according to Rajya Sabha member and senior advocate Vivek Tankha, who appeared before the tax tribunal on behalf of the party.
“The government hasn’t just frozen our accounts, but democracy has been frozen if the principal Opposition party’s account is frozen just weeks before the general elections. Will our country have a single party rule?” the Congress treasurer asked.
Assault on democracy: Kharge
Calling the IT action “an assault on democracy”, Congress president Mallikarjun Kharge appealed to the judiciary to “save the multi-party system and protect India’s Democracy.”
In a post on X, he said: “Power drunk Modi Govt has frozen the accounts of the country’s largest Opposition party - the Indian National Congress - just before the Lok Sabha elections. This is a deep assault on India’s Democracy ! The UNCONSTITUTIONAL money collected by the BJP would be utilised by them for elections, but the money collected by us through CROWDFUNDING shall be sealed!”
“That is why I have said that there won’t be any elections in the future… We will take to the streets and fight strongly against this autocracy !” the Congress chief added.
‘BJP’s electoral bond money untouched’
Party general secretary (organisation) K.C. Venugopal asserted that after the Supreme Court closed “one avenue to tilt the balance, the government has chosen a new route”. The top court had struck down the electoral bonds scheme in a Thursday verdict.
“The BJP has hoarded over ₹6,500 crore through the illegal electoral bond scandal, which remain untouched - but the earnest donations of ordinary INC workers and supporters are frozen,” Mr. Venugopal said in a post on X.
“Don’t be afraid Modi ji, Congress is not the name of power of money, but of the power of people... We have never bowed before dictatorship, nor will we ever bow down. Every Congress worker will fight tooth and nail to protect India’s democracy,” former Congress chief Rahul Gandhi said in a post on X.
Youth Congress chief Srinivas B.V. led an impromptu protest in Delhi, while the party’s State units plan to hold protests against the IT department’s action on Saturday.
