Delhi High Court withholds judgment on Congress’s appeal against ITAT ruling refusing to halt tax collection
The Delhi High Court reserved its verdict on the Congress’s petition contesting the ITAT’s order rejecting a stay on tax recovery for 2018-19. The party’s negligence since 2021 was criticized by the court, with arguments made by both sides regarding the freezing of accounts amidst an ongoing appeal.
Advocate Zoheb Hossain, for the income tax authorities, highlighted the party’s failure to pay 20% of the demand in 2021, leading to the entire amount being recoverable. Senior advocate Vivek Tankha, representing the Congress, stated the party had Rs 300 crore in bank accounts and criticized the authorities for seizing every account hindering the party’s ability to contest elections.
The dispute arose after the party’s income for the 2018-19 assessment year was assessed at Rs 1,99,15,26,560, resulting in a tax demand of Rs 1,05,17,29,635. The denial of exemption under Section 13A of the Income Tax Act was based on late filing of tax returns and accepting cash donations exceeding the limit per donation.
The ITAT, in dismissing the Congress’s stay plea, stated that violation of mandatory conditions in Section 13A left no room for discretion in granting exemption. The court reserved judgment, set to be delivered soon, amidst criticism from both sides regarding the freezing of accounts and financial hardship claims.
The Congress labeled the freezing of accounts as “an attack on democracy” ahead of the impending Lok Sabha elections. The party claimed that funds collected through crowdfunding were also frozen despite the case being sub judice. The ongoing appeal and freezing of accounts add tension to the already contentious tax recovery dispute.
