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Wednesday, April 24, 2024

Center Extends Tax Respite to Congress: No Enforcement Measures on ₹ 3,500 Crore Demand

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New Delhi: Ahead of the looming Lok Sabha elections, the Center delivered a notable reprieve to the Congress party, affirming to the Supreme Court today its commitment to abstain from coercive measures in recovering tax liabilities exceeding ₹ 3,500 crore. The apex court has earmarked July 24 for the next hearing.

In response to notices from the Income Tax department seeking settlement of mammoth tax dues totaling ₹ 3,567 crore, the Congress had sought recourse from the Supreme Court. Accusing the ruling BJP of resorting to “tax terrorism,” the party claimed the tax department’s actions aimed to stifle its financial operations in the electoral run-up. This interference, they argued, disrupted the level playing field necessary for fair elections, prompting an appeal to the Election Commission for intervention.

Notably, tax authorities had previously debited ₹ 135 crore from the party’s coffers, representing outstanding dues from prior years.

During today’s proceedings before a bench presided over by Justice BV Nagarathna, Solicitor General Tushar Mehta assured that the central agency would desist from any coercive actions against the opposition party during the electoral process.

“The party was offered the option to remit 20 percent by 2024, with the recovery of ₹ 135 crore already effected. Subsequently, a demand of ₹ 1,700 crore was raised. Hence, the ongoing dispute pertains to the latter figure. This matter can be adjudicated post-elections, and we commit to withholding any enforcement action until then,” clarified Mehta.

When questioned by the court regarding the Center’s stance on suspending the tax demand, Mehta clarified, “No, our assertion solely revolves around refraining from action until the conclusion of the elections.”

Advocating for the Congress, Senior Advocate Abhishek Singhvi underscored the party’s non-profit nature, emphasizing, “We operate solely as a political entity.”

The Solicitor General expressed an eagerness to present further arguments concerning the case’s merits.

Acknowledging that unresolved issues remain pending adjudication, the court committed to a thorough examination of the matter’s merits in due course.

For now, the Congress finds solace in this temporary relief.

Previously, the Congress had accused the ruling BJP of flouting tax laws with impunity, decrying the tax department’s perceived leniency.

Congress leader Rahul Gandhi issued a stern warning, asserting that once in power, his party would take decisive measures to prevent such transgressions in the future.

“When the government changes, stringent action will be taken against all those undermining democracy. Rest assured, the consequences will serve as a deterrent to any future attempts,” Gandhi proclaimed in a statement.

Senior party figure Jairam Ramesh decried ongoing attempts to financially cripple the Congress, affirming their steadfast resilience.

Echoing these sentiments, party stalwart Ajay Maken highlighted the need for a level playing field, denouncing actions aimed at impeding the Congress’s financial capacity to conduct electoral activities. He criticized the tax assessments dating back to 1993-94, implicating the late Sitaram Kesri, the party’s erstwhile treasurer.

“These directives hinge on fabricated evidence and orchestrated raids by the BJP’s proxies. Several third-party entities subjected to such raids have secured court injunctions due to tainted procedural practices by the Income Tax department,” Maken alleged, underscoring the absence of equitable treatment towards the Congress in securing similar interim relief.

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